It was in the late 1980s that longtime logger Jim Stublefield started to feel some deep distress about his industry. Cutting down trees wasn't paying, and Stublefield was planting saplings to scratch out a living instead.

Stublefield eventually decided he could log in a less-destructive way and in 2000 opened his own timber operation in the little town of Wolf Creek, north of Grants Pass. He's sawing and finishing logs that have been harvested to reduce forest fire danger, taken from private land without clear-cutting, or salvaged from the junk pile at large sawmills. He calls this "sustainable yield" logging -- "I get no joy in thumping big trees now."

And he wants his new business to do something rare in a resource-dependent industry: He wants it to last.

"I'm from Chippewa Falls, Wisconsin, which used to have the largest sawmill in the world. Now there are no big trees and there's nothing but paper mills," Stublefield says. "I just want something that will survive me, that we can keep doing forever. That's sustainable."

Used in the broadest sense, "sustainability" -- the buzzword that's now being tossed around progressive business circles -- encompasses economic viability, human health and environmental preservation.

It's in environmental practices where Oregon businesses lead the pack. They are pursuing several key goals:

- Don't extract any natural resources from the land faster than they can be replenished;

- Don't introduce toxins that can't be broken down in nature;

- Close the circle of production and consumption by recycling, reusing and reclaiming materials to the greatest extent possible.

So local builders are putting up new offices with recycled wood and paint, and installing energy-efficient windows and lights. A major metal fabricator is reusing wastewater to cast steel. A cooperative of Central Oregon ranchers is grazing only as many head of cattle as the natural grasses of the high desert can support.

Ruth Rominger has been following the state's steep trajectory as vice president of San Francisco-based U.S. Natural Step, which helps companies implement green business practices. "There's more going on in more sectors in Oregon than any other state," she says.

business people are doing these things in part because they make financial sense.

Already, environmental limits have wreaked havoc on Oregon resource industries such as fishing, where stocks have been severely depleted. Pollutants endanger human health and leave companies vulnerable to potential liability far into the future. In coming decades, these sorts of natural limits will ripple through the economy, with serious consequences for companies that worsen the situation even slightly.

"The main reason for businesses to engage sustainability is the same reason for society to embrace it," says Alan Durning, executive director of Northwest Environment Watch in Seattle. "If business isn't sustainable, sooner or later there is no economy."

Around the world, major corporations are realizing that a strong environmental ethic is a matter of survival. Look no further than Ford, which is rebuilding its massive Dearborn, Mich., auto assembly complex using rooftop plants to filter stormwater and solar panels and fuel cells to help power production.

Oregon companies that are bringing these ideas into the economic mainstream span numerous industries: timber, retail, architecture, food services, event planning, law, commercial contracting. They include Nike, Collins Pine, Norm Thompson, Rejuvenation Hardware, Meeting Strategies Worldwide, Stoel Rives -- and the list goes on.

These Oregon firms are building a type of stability into their business plans that may not add jobs or quick revenue growth but is designed to pay off in the long term. They will be better equipped to navigate the fast-approaching "era of limits," a phrase writer Marc Reisner once used to describe the water crisis in the arid American West. Oregonians are also developing a strong foundation of knowledge and invention for export to places that aren't as far along the road to a sustainable future.

This is key, says Durning. "Those regions of the world that figure out how to make a profit from sustainability will have products, services and expertise that are in great demand elsewhere."

THE CHALLENGE FOR green business advocates in Oregon is to show how companies can spend less and earn more right now, before the economic system is in cataclysmic environmental crisis.

Jim Stublefield knows the problem well. His sustainable yield garden furniture and cut lumber might be more attractive to green consumers, but shoppers can still get conventional goods for much less at Kmart. He's hoping that a new line of fir flooring, marketed through a Northwest cooperative of small woodworkers called Healthy Forests, Healthy Communities, will dig him out of debt. "So far," he concedes, "I've proven I can go broke with the best of them."

But many local companies are demonstrating that implementing ambitious environmental goals actually helps the bottom line.

When John Emrick, CEO of catalog retailer Norm Thompson, was planning the company's new Hillsboro headquarters in the mid-1990s, he was looking for ways to reduce environmental impact and save money. He directed contractors to use recycled materials and low-toxin adhesives and paints. Then Emrick signed off on a cutting-edge computerized heating and air conditioning system that would conserve energy and pay for the green architectural features within eight years.

By 2000, four years after the building was completed, the extra money was already paid back.

"That's when the financial people said, 'Now let's look at the rest of the company,'" Emrick says.

Norm Thompson is cutting packaging use by as much as 20% by shipping all of a customer's purchases in one box. That saves more than $300,000 a year. The company has also saved with small nips and tucks -- it traded paper cups for coffee mugs and saved another $10,000.

Collins Pine, the subsidiary of Portland-based wood products manufacturer Collins Companies, is making sustainability pay off as well. New equipment at the company's Klamath Falls hardboard and particleboard manufacturing facility now uses mountains of sander dust, formely burned as waste, to make particleboards at a savings of $562,000 a year. Collins has also stopped using an onsite landfill -- waste is recycled, reused or burned for fuel -- and it has a goal of eliminating wastewater. Teams of Collins employees have uncovered ways to reuse steam, wood chips and other byproducts along the production line.

"The annual savings have been in the seven-figure range," says senior vice president Wade Mosby.

SUSTAINABILITY IS ALL WELL AND GOOD, critics say, for well-heeled companies that can afford to revamp their operations and might even get a boost in the marketplace by highlighting their "green" credentials.

"Environmental stewardship is an important thing, but if you can't afford it, it doesn't get done," says Paulette Pyle, with the farm lobbying organization Oregonians for Food and Shelter. "The 'bigs' can afford it."

It's true that both Norm Thompson and Collins are large enough (at No. 29 and No. 37 on Oregon Business' 2002 list of top private companies) to fund

training, studies and new equipment to alter their internal practices -- for instance, paying for the services of Natural Step coordinators.

But smaller operations are successfully taking the plunge as well. Consider Chown Hardware, a distributor based in Northwest Portland. The company sends out around 115 orders a day, but warehouse manager Rob Combs says he rarely buys any new packaging because the company reuses all incoming boxes, saving around $15,000 annually. Chown also sends wooden pallets and foam to other small businesses in Northwest Oregon, lowering garbage collection costs. Last year, Chown turned down an opportunity for a government grant to enhance these efforts,"because it doesn't cost us anything to recycle," says Combs.

Portland's Hot Lips Pizza, with three shops in the city, has made small investments pay off. It installed new freezers, light bulbs, and a water heater at a cost of $3,000. With its energy bill cut in half, the company paid back the investment in seven months.

Many local companies were taking big steps toward sustainability before it became a buzzword. For instance, winners of Portland's Businesses for an Environmentally Sustainable Tomorrow (BEST) awards over the years have been companies such as Boeing, which cut its energy consumption in half with new air compressors in the early 1990s, and Columbia Steel Casting, which began water conservation measures in the early 1980s and now saves $500,000 annually.

Roseburg Forest Products president Allyn Ford doesn't think changes in efficiency -- such as Collins Pines' in Klamath Falls -- are anything special, even though they've been grouped as part of a new sustainability movement. "We solved our waste problems in the early 1970s," Ford says. "To say we've got a revolution on our hands, I don't know."

But what Collins is doing isn't limited to reuse and recycling on its production lines. The company's private forestlands, mostly in California and Pennsylvania, were the first in the U.S. to receive certification from the international Forest Stewardship Council, which assures that foresters are maximizing soil, water and wildlife habitat conservation.

Other Oregon companies are also pushing the envelope. Nike has committed to phasing out polyvinyl chloride (the leather substitute known as vinyl) because it generates a host of harmful toxins. Norm Thompson says it will also push to stop using vinyl and buy only cotton grown without chemical pesticides or fertilizers.

WILL LOCAL EARLY ADOPTERS of sustainability give Oregon a leg up in the long run? Not likely, says John Ledger, environmental policy director at Associated Oregon Industries.

"It has a benefit in how you run a company and a benefit to society," says Ledger. "But sustainability is not going to set the state economy on fire."

Oregon's building sector, though, defies that assessment.

Over a decade or so, Portland has gone from a place with a handful of green builders to a hub of national innovation where green building practices are widespread. "When I go to other cities, people there think we walk on water," says Greg Acker, an architect in Portland's Office of Sustainable Development.

Key demonstration projects in the Portland metro area in the mid-1990s, such as North Clackamas High School and a futuristic house sponsored by Portland General Electric, showed that features such as nontoxic building materials and energy-saving lighting systems designed to respond to daylight could be installed without vast expense.

"Once builders realized that green building was not about a political agenda but that it made sense, it took off," says Nathan Good, a former member of PGE's green building team and now an architect with CH2M Hill.

Then, in 2000, a new national system for rating buildings, Leadership in Energy and Environmental Design (LEED), was launched by the U.S. Green Building Council. (The council's president, Christine Ervin, is based in Portland). Builders apply to have their projects rated on everything from energy-efficient appliances to reused materials and nontoxic paint.

LEED gives local contractors something concrete to shoot for. Portland now has the most LEED buildings per capita of any city in the nation, and Oregon has the first LEED-certified winery building at Sokol-Blosser's Dundee vineyards. And the state capitol has added rooftop solar panels, making it a beacon for alternative energy advocates.

"Green building has proved to be an alternative much faster than I would have expected," says Cindy Catto of Associated General Contractors in Oregon. "My contractors find that having the [LEED expertise] arrow in their quiver helps distinguish them. Now, medium and large contractors are focusing on what it takes to be LEED certified."

Tax credits and grants from the city of Portland, as well as a PGE-state housing department low-interest loan program, also support the market for green building. And a growing network of suppliers has emerged to service these new projects -- from PPG Industries' plant in Salem, which manufactures high-performance windows, to Stormwater Management, which has built new filters to purify runoff before it heads to local streams and rivers. These support companies, Good says, could be "one of the great economic producers in the state."

A GROWING CONSUMER MARKET has helped boost green industries in Oregon.

Buyers' willingness to pay more for goods that are grown without pesticides, chemical fertilizers or hormones has driven the success of companies as diverse as Oregon Country Beef, a cooperative of 40 Central and Eastern Oregon ranches raising natural-fed cattle, and Emerald Valley Kitchen in Eugene, which makes hummus and salsa dips with pesticide-free ingredients.

Customer interest declines when they can't clearly see the environmental effects of their purchases.

Collins' Wade Mosby says the public has yet to show a great preference for more expensive wood products bearing the Forest Stewardship Council certification label, but consumers and wholesalers will buy environmentally sensitive wood when the price matches that on conventional items. Home Depot and Lowe's have agreed to give this sort of preference to lumber from certified forests.

That's attracted the attention of sustainability skeptics such as Roseburg Forest Products' Ford, who says he's working with the Stewardship Council to have more of his company's timberland certified. Other Northwest forest products companies such as Weyerhaeuser and Hampton Affiliates have joined a less stringent industry-sponsored certification process called the Sustainable Forestry Initiative.

Consumers' desire for more green products ultimately presents a dilemma. Should a company do just the bare minimum to appear green and attract more customers, without adding to its costs? This is "greenwashing," a buzzword among corporate watchdog groups that has mirrored the spread of "sustainability."

Martin Goebel, executive director of the Portland-based nonprofit Sustainable Northwest, isn't worried: "This is a global imperative; if a company is embracing this stuff at any level it's good."

Norm Thompson's John Emrick thinks he has a simple way to let consumers decide these issues. He plans to eventually allow customers to "drill down" from any food, craft or piece of clothing that's featured in the company's online catalog, all the way back to the item's maker.

"That challenges the merchants, " says Emrick. "We're going to tell people exactly where this came from."

COMPANIES AND COUNTRIES are looking to Oregon's pioneering expertise as they grow their own environmental practices.

For example, Team Oregon, a network of green consultants, architects and engineers, helped craft a national sustainability framework for Taiwan and is advising Chinese cities on waterway cleanup. And Oregon high-tech types are involved in discussions with computer companies about a nationwide recycling program for PCs and printers.

"Seventy-five percent of computers are sitting in storage," says Wayne Rifer, a consultant in Cedar Mills. "If it's a newer model, it can be reused. If it's older, there's recycling value in the materials."

Rifer says one result of the program will be that computer makers will begin designing new machines so they can be easily deconstructed and the components incorporated into new products.

Nike is exploring this sort of product design. Instead of grinding down used sneakers to make basketball courts and turf fields in the future, the company will take them back and build new sneakers out of the materials from the worn-out shoes.

Futurists such as William McDonough and Michael Braungart, authors of the recent book Cradle to Cradle: Remaking the Way We Make Things, say this idea of "product take-back" is the most economical and environmentally responsible way to do business. It puts companies in a position to take advantage of a new sort of world marketplace, where resources are scarce and there's great value in manufactured items returning to the producer. It's a trend that will affect everything from cars to grocery bags.

And companies across Oregon are demonstrating that aligning with this emerging environmental ethic can be a financial asset right now. It's the sort of creative thinking that has helped push Oregon toward economic and ecological stability in the past. And will again in the future.

If you have comments about any articles you've read in Oregon Business magazine, e-mail us at feedback@oregonbusiness.com.

Copyright 2003 Oregon Business magazine