Sandy Treagus, Mountain Equipment Co-op
Sandy Treagus is the Chief Financial Officer of Mountain Equipment Co-op, Canada’s largest outdoor retailer, and oversees a portfolio of some of the greenest buildings in the country.
Sandy Treagus is no ordinary Chief Financial Officer. When asked about how the CFO of Mountain Equipment Co-op goes about making MEC’s business green in a highly competitive environment, he calmly responds by saying he doesn’t know of any other way.
As CFO, he is responsible for all financial aspects of running Canada’s largest outdoor retailer, including managing its business plans and real estate – an additional responsibility he takes very seriously. Treagus oversees a portfolio of some of the greenest buildings in the country. “In addition to being green, MEC buildings must first and foremost serve their purpose from a retail perspective,” claims Treagus. “We don’t see this as a trade-off, building green is integrated into who we are as a retail co- operative.”
MEC is so committed to building green, they have developed their own “green building code”. MEC references and supports LEED standards, yet it has tried to go beyond them whenever possible. “Creating a new building code was not about reinventing the wheel but rather interpreting LEED and other green building standards and drawing the best from them to create a framework with MEC’s specificities in mind” said Treagus.
MEC optimizes its buildings with an integrated design process, using ideas and technologies that make sense within the context of each site. A wise financier, Treagus advises those interested in building green ”not to eat everything at the buffet” but rather to pick what will be most effective. For example, a building can gain LEED accreditation points when installing carpeting that contains recycled fibre, but these points are not useful to MEC as the co-op chooses to avoid carpeting in its stores altogether.
MEC will be opening a new store in North Vancouver in early spring 2012. It will be the greenest retail store in the region. The whole process of rezoning the existing property and engaging the public about the land-use was a learning process. Treagus was adamant that MEC had to prove it could be a good steward of the area, which encompasses a spawning creek where community efforts are being made to reintroduce salmon.
The North Vancouver store will offer more access and amenities to Lynmouth Park, it will recycle most of the material from the existing site and it will install a highly- optimized storm-water management system.
Treagus suggests that it isn’t necessarily the sexy cutting-edge technology that will move businesses forward but rather proven, simple solutions. Treagus illustrates the point by referring to MEC’s two most recent stores, which sport saw-toothed roofs for optimal light penetration.
This rather simple design provides a highly reflective albedo roof on the back of each sawtooth, allowing light to penetrate deep into the store. This reduces the required lighting load, which in turn reduces the mechanical cooling requirement. It’s an elegant and simple solution to reducing energy consumption and greenhouse gas emissions.
Although “living green roofs” have become the rage for some new buildings, MEC has not moved in this direction because of the carbon footprint of some green roofs. “For some buildings, the additional energy going into the structure to enable it to support the weight of the Babylonian garden may not be offset by the benefits of the green roof itself over the life of the building,” reasons Treagus. On the operational front, by looking at ways to move inventory around a little differently, using freight trains in some cases rather than trucks, or simply putting motion-sensors in the distribution centre to activate lights in areas only where staff are present, MEC has already significantly reduced its overall carbon footprint.
But how does going green bode with the realities of a competitive business world? This is where Sandy Treagus is truly innovative. He integrates the realities of a world that will become increasingly carbon-constrained in the overall business plan. The “green” aspects are not mere sidelines for MEC, they are core to the operations and long-term planning of the co-operative. Whether it be product footprint, logistics, buildings or even staff commuting, MEC has plans to measure, manage and reduce its emissions. Even if the competitive advantage of doing so is not yet apparent, Treagus is convinced that it will be in the future.
He advises CFO’s to be patient with capital investments and to look at longer-term pay back periods. He acknowledges that the upfront capital costs can be high, but the return on investment over the long term can more than offset the initial investments. Two roof- top solar projects in Ontario, both soon to come on stream, are examples of this model. “Where we may differ from conventional retailers,” says Treagus,” is that we try to own the buildings we occupy. It’s proven to be an effective mitigation strategy. There may be more capital required up front, but we do see lower downstream costs and reduced energy risks over a number of years.” He also points to escalating costs of energy and the delayed costs of not addressing increasing green house gas emissions as further rationale for immediate action.
“It’s not rocket science," Treagus explains, “the solutions are often simple and cheap.” As a member of MEC’s Senior Management Team, Treagus knows the power of the CFO in influencing the tone and culture within an organization – and he has fun doing it. His role in overseeing the finances and the real estate development for MEC allows him to demonstrate how a major Canadian retailer can both maintain a healthy balance sheet and be a leader in green buildings.