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President Obama’s “anti-swag” executive order: A letter to our Stakeholders

November 16, 2011

When Rivanna became a Virginia Benefit Corporation on July 1, 2011, we made a legal commitment to consider the interests of not only our shareholders, but other stakeholders, including coworkers, clients, suppliers, community, and the local and global environment.  With that commitment in mind, this letter to our stakeholders addresses President Obama’s recent Executive Order Promoting Efficient Spending or “anti-swag” order.

Dear Rivanna Stakeholders:

President Obama’s Executive Order (EO) Promoting Efficient Spending dated November 9, 2011 mandates a 20% reduction in certain federal expenditures by FY2013.  Of particular interest to Rivanna Stakeholders is Section 7: “Extraneous Promotional Items.  Agencies should limit the purchase of promotional items (e.g., plaques, clothing, and commemorative items), in particular where they are not cost-effective.”

While we do not make clothing or general promotional items, Rivanna has been making plaques and awards for the federal government since 2002.  We currently hold Federal Supply Schedule Contract GS-07F-9259S (Schedule 078).  This EO affects our business.  What does this mean for our stakeholders?

For the local and global environment, this could be good news.  As anyone who has ever attended a trade show with agency exhibitors can attest, there is an alarming amount of promotional material or “swag” distributed by the federal government.  Many promotional products are made offshore, so government purchasers have little insight, if any, into who makes these products, how they are made, and at what social and environmental costs.  Furthermore, many of these products, including a good portion of down-cycled, so-called “eco” products, cannot be recycled.  If this 20% reduction in expenses means that the government actually buys less, it could amount to a sizeable reduction of non-recyclable solid waste in our landfills.

Of course, if federal agencies instead opt to purchase even lower-cost swag (if that is possible) and put more pressure on suppliers to look offshore for the cheapest possible goods, we could have a greater environmental problem.  As they say, “cheap is not green.”  Let’s hope that clear thinking prevails here and that current efforts to green the federal supply chain are strengthened, and not undermined, by this EO.

With respect to our work at Rivanna and our own environmental impacts, we will make every effort to respond to the needs of our federal clients.  At the same time, we will not succumb to price pressure that forces us to source materials of dubious origin or otherwise compromise our commitment to the environment.  This has been our standard operating procedure for over a decade, and this EO will not change that.

To our federal government clients: you have supported our business for many years and we hope to continue our work with you.  When you need products that we can supply, we’ll do our best to help you meet your reduced budgets without sacrificing our shared commitment to quality, environment, and community.   Like most other contractors who make products in the U.S. and pay a living wage, we cannot absorb 20% price reductions and keep our lights on.  I’d rather you buy less of what we make, at a fair price, so that we can afford to do business with you. If the intent of this EO is to ensure that your agencies become more thoughtful stewards of taxpayers’ dollars, then hopefully we’ll be able to find some common ground.

To our non-federal clients, bankers, creditors, suppliers, neighbors, friends, families, and fans: we anticipated tighter federal budgets and have been diversifying our client base over the past few years. We appreciate your support and, as always, welcome your referrals!

To our Rivanna Team: I understand if you’re a little taken aback by seeing the plaques we design and manufacture with love and care lumped in with “extraneous promotional items” or worse yet, “swag.”  My first response when I read the EO was, “Ouch, Mr. President!” After all, our plaques are made from FSC-certified and recycled materials.  We design and make them in Virginia. Our mission is to create jobs for recently-arrived refugees and others who need them most.  We’re a Virginia Benefit Corporation and a Certified B Corp.  We’re committed (and, by choice, now legally bound) to transparency.  For ten years, we have been working diligently to make beautiful products and provide great service to the federal government and all of our clients.  Haven’t we earned the right, to get worked up about this?

Maybe.  But here’s the thing:  we don’t get it both ways.  If we want this economy to thrive again and we want the government to cut spending, improve efficiency, and be a more thoughtful steward of our tax dollars, we don’t get to object when federal budget cuts jeopardize one of our own sources of revenue.   If we want a cleaner planet, we need to support initiatives that put us on that path, even when those initiatives do not serve our immediate economic interest.

So, let’s breathe deep and maybe take a few hours to watch Annie Leonard’s The Story of Stuff or David Redmon’s Mardi-Gras: Made in China. Then let’s get back to work.  Let’s keep designing and making products in this country, and let’s make them better.  Let’s provide better service.  Let’s innovate to keep our products attractive and affordable.  Let’s be better environmental stewards and community partners.  Let’s continue to compete for federal contracts and provide better overall value for taxpayers’ dollars.  We’re a B Corp.  B is for better.

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