ecolab

Fortune Staff

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

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The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

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Headquartered in St. Paul, Minnesota, Ecolab helps companies optimize resource use and promote hygienic environments. Its clients are primarily in the foodservi

Ecolab | 2023 World's Most Admired Companies

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Ecolab | 2023 World's Most Admired Companies | Fortune

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[MUSIC PLAYING] BRIAN O'KEEFE: Ecolab is a company that's been around for a while. Your business is mostly based around water, testing chemicals in water, water systems, water management systems. How do you come at this topic? Where is the opportunity for Ecolab to capitalize on this sensor revolution and apply it to systems in cities? Is this something you're really energized about? DOUG BAKER: Yeah, I guess if I was to define-- we do water, we do hygiene. Hygiene invariably, prime ingredient is water so. Yeah, we treat water in many applications and pretty much throughout the industrial complex. Look if its power, steel, mining, paper, water is kind of the secret elixir that we use in virtually every manufacturing process. It's pretty obvious in food, but it's probably not as obvious in everything else that's made. So we see all these applications. I guess two things-- one, we're already wiring in industrial applications because we have the advantage of scale. And so you have-- if you can reduce water and energy by 30% in a very large industrial application, you can justify a lot of capital. That same justification math doesn't quite work yet on smaller building sites, but it soon will over a piece of time. So I'd say right now what we're working and concentrating on is learning how to do this in industrial applications. And so we're literally monitoring tens of thousands of manufacturing sites now in a facility, that happens to be in Pune, India could be anywhere, to understand water usage, when they're out of spec, what's going on. And that learning, obviously, is something that we can learn to apply. But it's purpose specific. And I think, when I hear smart cities and even in prep is this concept of this big bang and all of a sudden we're going to have all this data. And what are we going to go do? I mean, at the end of the day, you've got to design something to accomplish something. I don't know how you're just going to make a-- you know, take a dumb city and make it smart. For what end? And I think there needs to really be a conversation about what we're trying to accomplish here. And if it's water and energy reduction, that's easily targeted. And I think something that we can get after. If it's also reducing capital pressure and everything else on systems, then you might end up targeting and getting after the process in a different way. But a city is a big complicated beast. I think we're going to tackle it, I would imagine you're going to do it a process at a time. [MUSIC PLAYING]

Insights: Ecolab CEO On How to Build a Smart City

Uncategorized

Doug Baker outlines one approach to building smart cities.

Ecolab CEO On How to Build a Smart City

Doug Baker outlines one approach to building smart cities at Fortune's Brainstorm E conference. (September 2015)

Wow is a, uh, company has been around for a while. Your business is mostly based around water testing chemicals and water, water systems, water management systems. How do you come at this topic, where the opportunity for ICO to capitalize on the sensor revolution and apply it to systems in cities? Is this something you're really energized about? Yeah, I guess I'm going to find we do water. We do hygiene hygiene. Invariably, prime ingredient is water, so we treat water and many applications and pretty much throughout the industrial complex. Power, steel, mining, paper Water is kind of a secret elixir that we use to virtually every manufacturing process. It's pretty obvious and food, but it's probably not as obvious and everything else it's made. So we see all these applications. I get two things. One, We're already wiring and industrial applications because you have the advantage of scale, and so you have. If you could reduce water and energy by 30% in a very large industrial application, you can justify a lot of capital that that same justification Math doesn't quite work yet on smaller building sites, but it soon will over a piece of time so I'd say Right now what we're working and concentrating on is learning how to do this on industrial applications. So we're literally monitoring tens of thousands of manufacturing sites now in a facility that happens to be in pony. India could be anywhere to understand water usage when they're out its back, what's going on and that learning obviously is something that we can learn to apply. But it's its purpose specific. And I think when I hear smart cities and even in proud, is this concept of the Big Bang. And also we'll have all the data on What are we gonna go do? I mean, the end of the day, you've got to design something to accomplish something. I don't know how. You just gonna make a take a dump city and get smart for what end? And I think there needs to really be a conversation about what we're trying to accomplish here. And if it's water and energy reduction that's easily targeted, and I think something that we can get after if it's also reducing capital pressure and everything else on systems, then you might end up targeting and getting after the process in a different way. But a city is a big, complicated beast, and we're gonna tackle it. I would imagine they're gonna do it a process at the time.

Doug, everybody's talking about leadership these days, especially now that we have a new president. What do you think it takes to be an effective leader? So we talk about authentic leadership in this day and age. At the end of the day, I think you've got to operate on your own style. But what people resonate with, I believe, is do they think you're out for the greater good? Is the leadership about you, or is it about whatever organization, or whatever entity that you're leading? You've been the CEO of Ecolab for 12 years, and that's unusual, because most CEOs keep that top job for half that. What would you say has been the key to your leadership? One thing I would say to any leader is, get a great team. Life becomes quite easy, if you do. It's almost impossible, if you don't. And so this ability to attract people, keep them, grow together, and I would say also understanding that you need to be a better leader next year than you were the year before-- so you're never a finished product, and I think you've got to keep aspiring to become better, learn, change, modify your approach, given the circumstances. You transformed Ecolab into this fast-growing area of water technology and conservation. You made a lot of changes, in terms of your vision of the company. What did you have to do to get people to back up and execute on this new mission? There was buying. I think everybody understood strategically why this is important, because it basically enabled us to do more for our customers. And that's one of the key reasons we exist. And so this water piece was very important, given what was going on and what our customer needs were. So it wasn't a long discussion getting people onboard. But you went through a lot of dramatic changes to get to this point. And as you went through all of that, how did you still communicate and repeating that message to all of your people? Well, the message was winning as one. And we were going to come together and form a new company, and it was going to be new, and it was going to be new on all accounts. And it was going to be a better company. It was going to be better than the Ecolab that existed before we bought Nalco, and it was going to be a better Nalco post-acquisition. And the way we were going to do was really take best of both-- best person, best process, best program-- and apply it. And we hit that hard for five years. But ultimately, the messaging stops being effective, and people just watch-- is it, in fact, occurring? If it is, it gets legs. If it's not, there is no message in the world-- verbal, written, video, or anything else-- that's going to overcome contrary action. You also had to transform the culture of a nearly 100-year-old company to be much more innovative, and so how did you encourage leadership on all levels of the company so that people would be more innovative, more disruptive, rather than doing things the old-fashioned way? You've got to demonstrate your willingness to take risks, if you're the leader. And you're going to make mistakes. You've got to own up to them. Don't apologize for them. Fix them, address them, and use yourself as an example. So you going to do something bold and right when it's called for-- not just to do it, but when it's called for-- even if it means it may cost you your job. I think that's your responsibility, as a leader. If people are seeing you willing to do that, they become much more emboldened and understand risk taking is part of the equation, it's part of the expectation, and it's safe. It's OK. 

Ecolab's CEO Says Responsible Leaders Take Big Risks

Leadership

Doug. Everybody's talking about leadership these days, especially now that we have a new president. What do you think it takes to be an effective leader? So we talk about authentic leadership in this day and age. At the end of the day, I think you've got to operate on your own style. But what people resonate with, I believe is Do they think you're all for the greater good? Is the leadership about you or is it about whatever organization or whatever, Whatever What is into me that you're leading? You've been the CEO of Equal F for 12 years, and that's unusual because most he'll keep that top job for half that. What would you say has been the key to your leadership? There's one thing I would say to him the leader is. Get a great team. Life becomes quite easy if you d'oh, it's almost impossible if you don't until this ability to attract people keep grow together. And I would say also understanding that you need to be a better leader next year than you were the year before. So you're never finished product, and I think you've got to keep inspiring to become better word change. Modify your approach. Given the circumstance, you transformed equal lab into the fast growing area of water, technology and conservation. You made a lot of changes in terms of your vision of the company. What did you have to do to get people to back up and execute on this new mission? There was buying. I think everybody understood strategically why this is important because it basically enabled us to do more for our customers. And that's that's one of the key reasons we exist. And so this water pieces very important, given what was going on and what our customer needs were. So it wasn't a long discussion getting people on board, But you went through a lot of dramatic changes to get to this point. And as you went through all of that, how do you still communicate and repeating that message to all of your people? Well, the method was winning is one, and we're gonna come together and form a new company, and it was gonna be new and was gonna be new one in all accounts, and it was gonna be a better company was gonna be better than the equal lab that existed before we bought in Alcoa is gonna be a better now pull pull its acquisition in the way we were going to do. It was really take testable best person, Best process, best program and apply it. And we hit that hard for five years. But ultimately the messaging stops being effective and people just watch. Is it in fact, occurring? If it is, it gets legs. If it's not, there is no message in the world verbal written video or anything else that's gonna overcome contrary action. You also had to transform the culture of a nearly 100 year old company to be much more innovative. And so how did you, uh, encouraged leadership on all levels of the company so that people would be more innovative, more disruptive rather than doing things the old fashioned way? You've gotta demonstrate your willingness to take risks. If you're the leader and you're gonna make things, you got to own up to him. Don't apologize for him. Fixem address. Um, and use yourself is an example. So you're gonna do something bold and right when it's called for not just to do it, but when it's called for even if it means it may cost you your job, I think that's your responsibility. The leader. If people seeing you willing to do that, they become much more emboldened and understand. Risk taking is part of the equation. It's part of the expectation and it's safe. It's okay.

 Doug, President-elect Donald Trump says he's America's first business president. What do you think he's going to do for business? Trump's clearly going to change policies. And with change is going to come, I think, a change in outcome. And I think, with the right moves, that outcome could be positive. But when you're making these changes, there's unintended consequences if you're not thoughtful about it. But that's why he's got a team. Well, as you know, Trump campaigned on saying that he was going to get the US economy to grow by 4%, maybe 5%. Certainly, the markets are confident that the country's going in the right direction. But do you think that President-elect Trump can really trigger that kind of growth? Well. I'm not betting that the US is going to be growing 4% to 5% in the near term. But I do have a lot of confidence in the US. I had confidence before the election, and I remain confident, simply because I think we have a lot of assets as a country. And I'm very hopeful that we can get a few things done that will further enable business productivity and growth in the country, because I do think it's foundational and important. And it's one of the great tools to start erasing inequality. It looks like tax cuts and a tax holiday on overseas earnings are still on the table. Do you think all that money will get reinvested into the economy and, ultimately, result in more jobs and more hiring? It can. I don't think it's a fait accompli. It's not simply that you bring the money back. We invest money when we have a business opportunity or a growth opportunity in front of us. So it's not invested because I have a pile of cash, and I hate that it sits in a bank. Therefore, I'm just going to deploy it randomly. So I think it's important to get our corporate tax rules to be much more sane than they are today. They're crazy, and we need to fix them. And if tax holiday is one of the steps, that's fine. If it's the only step, we've done it before. It doesn't really solve the ongoing challenge that we have. We've got to get after this and start getting rules that drive better behavior than we have right now. Let's talk a little bit about Trump's environmental policies. He made it very clear during the campaign that he was going make some significant changes. Do you think he's going to fulfill those promises? I think he's going to go out and try, no doubt about it. So I think the environmental policy will change, and we'll adjust. I also think states have a big say in this, right? And so it's not as simple as a federal mandate. I think they can make it-- they have their place, but there's also a number of state mandates. And also, I think, broadly, the population is concerned about the environment. So if he does abolish the Environmental Protection Agency, if he ends some environmental regulations and revives the coal industry, what does that mean for Ecolab, given that you're in the business of water conservation? You're a green tech, clean tech kind of a company. Well, I think, perversely, the answer is it's probably beneficial for our company, even though I would say it would be a regrettable decision in the minds of many. And the reason it would be beneficial is we do water treatment. The water challenge is really a supply and demand challenge. But we also treat water in mining operations to make sure it's clean. We treat it in oil and gas operations to make sure it's clean. Because this work is going on, and we want to make sure it's done as environmentally safely as it can be. So I don't think there's going to be a wholesale change or we no longer follow clean water acts or air acts, which have been in place since the '70s. 

Ecolab's CEO Isn't Worried About Trump's Stance on Climate Change

Douglas Baker says his company will have to “adjust.”

does. President elect Donald Trump says he's America's first business president. What do you think you could do? Trump's clearly gonna change policies and with change is going to come. I think it changed an outcome on I think with the right move, that outcome could be positive. But when you're making these changes, there's unintended consequences if you're not thoughtful about it. But that's why I've got a team, You know, Trump campaigned on saying that he was going to get the U. S economy to grow by 4% maybe 5%. Certainly the markets are confident that the country going in the right direction. But do you think that President Elect Trump can really trigger that kind of growth? I'm not betting that U s gonna be growing 4 to 5% in the near term, but I do have a lot of confidence in the U. S. I had confidence before the election, and I remain confident simply because I think we have a lot of assets in the country and I'm very hopeful that we can get a few things done that will further enable business productivity and growth in the country, because I do think it's foundational and important, and it's one of the great tools to start a racing inequality. It looks like tax cuts and a tax holiday on overseas burnings are still on the table. Do you think all that money will get reinvested into the economy and ultimately result in more jobs and more hiring can? I don't think it's fate accompli. It's not simply that, you know, you bring the money back. You know we invest money when we have a business opportunity or growth opportunity in front of us. So it's not invested because I have a pile of cash and I hate that it sits in a bank. Therefore, I'm just going to deploy it randomly. So I I think I think it's important to get our corporate tax rules to be much more sane than they are today. They're crazy and we need to fix him. And if tax holiday is one of the steps, that's fine. If it's the only step we've done it before, it doesn't really solve the ongoing challenge that we have. We've got to get after this and start getting rules that drive better behavior than we have right now. Let's have a little bit about Trump's environmental policy. He made it very clear during the campaign that he was gonna make some significance changes. Do you think he's gonna fulfill the promise? I think he's going to go out and try, no doubt about it. So I think the environmental policy will change and we'll just I also think states have a big say in this, right? So it's not as simple as a federal mandate. I think they can. They could make it. You know, they have their place, but there's also a number of state mandates, and also, I think, broadly, the population is concerned about the environment. So if he does abolish the Environmental Protection Agency, if he ends some environmental regulations and revived the coal industry, what does that mean for equal lab? Given that you're in the business of water conservation, you're a green tech, clean tech kind of a company. Well, I think perversely, the answer's probably beneficial for our company. Even though I would be a regrettable decision in the minds of many in the reason would be beneficial is we do water treatment. The water challenges really a supply and demand challenge but we also treat water in mining operations to make sure it's clean. We treat it in oil and gas operations to make sure it's clean because this work is going on. We want to make sure it's done is environmentally safely as it can be. So I don't think there's gonna be a wholesale change where we no longer follow clean water acts or or air acts which have been in place since the seventies.

Ecolab

Company Information

World's Most Admired Companies
As of 2/1/2023

Ecolab

Company Information

World's Most Admired CompaniesAs of 2/1/2023

World's Most Admired Companies
As of 2/1/2023