This is episode 36 of the Humanizing Growth Series, hosted by the Institute for Real Growth. The guest is Hakan Bulgurlu, chief executive of Arçelik, a global white goods company with more than 30,000 employees and a stable of brands that includes Grundig and Beko. The conversation runs from personal transformation to the operating model, and it keeps returning to one question: what earns a company the right to be believed on sustainability.
Bulgurlu’s argument starts before the company. He holds that any vision has to begin with a self-transformation, and he applied that to himself first. He wanted something that would give him credibility with the teams and refocus the company around a single purpose. Sustainability is that purpose, and the company was then centered on it.
Key findings
- Arçelik is carbon neutral from today in its scope 1 and scope 2 emissions, on a 2019 and 2020 baseline. Bulgurlu contrasts this with distant targets, which he says let people conclude the problem is not urgent enough to act on or to fund.
- The 2030 commitment is to cut the emissions caused by the company’s appliances by half. Progress is reported weekly against the 2030 position, and the interview counts only 421 weeks left at the time of recording.
- The company leads the Dow Jones Sustainability Index, announced the week before the recording, for a third consecutive year.
- The capital markets have priced the position. A recent 350 million euro green bond came in roughly 200 basis points below the Turkish sovereign bond.
- Asked to rank stakeholders, Bulgurlu puts the customer first and expects the rest to follow. He also states the test plainly: winning is only possible if you serve all of your stakeholders.
- The named pitfall for any leader following this route is greenwashing: claims that cannot be substantiated. Credibility in this space is easy to lose.
Why the vision started with the leader
The company’s problem is physical, and Bulgurlu does not soften it. Its appliances consume roughly 30 to 40 percent of the energy used in a home. Talking about that credibly, he decided, required something of him personally. He climbed Everest, and he says the sustainability message works far more effectively when the mountain is part of it.
The specific fact that moved him is a water supply. He describes becoming aware of melting glaciers that provide agricultural and drinking water for about two billion people. His conclusion is about displacement rather than temperature. Climate migration on that scale has never happened.
The case against distant targets
Bulgurlu treats 2030 and 2050 pledges as a way of deferring cost. When everyone talks in those numbers, the work stops feeling urgent enough to act on or to commit resources to. His answer is to hold the company to the position today, which is why the scope 1 and scope 2 claim is stated as a present fact rather than a target.
He is equally clear that the hard part has not started. By his own account the company has only just begun picking the low-hanging fruit. The halving of appliance emissions depends on technologies that do not yet exist, and the reporting cadence is weekly rather than annual.
Coalitions, and the limits of acting alone
No single company can carry this, and the interview lists the alliances instead. There is a CEO alliance of roughly 90 chief executives who have signed a letter on decarbonizing their businesses. The company also received a Terra Carta seal from Prince Charles, awarded to 45 companies worldwide.
The gap that remains is the value chain. Success is defined by the customer’s choice, and on that measure the company is described as far from successful. Suppliers, materials providers, and customers are not yet fully integrated into the effort.
Advice to a leader starting out
The warning is greenwashing, and the remedy offered is sequence. Become aware of your own impact and your own consumption patterns, and change those first. Only then does the message carry.
He offers his own solar panels as a worked example of mispriced payback. He was told the payback would be six years. That calculation ignores the carbon not emitted, and pricing that in changes the answer.
The microfiber filter, and who owns a problem
The clearest product example in the interview is a washing machine filter. It captures about 90 percent or more of the synthetic fibers released in a wash. The reaction inside the industry was that this was not the company’s problem to solve, but fast fashion’s.
Bulgurlu says the market settled the argument. Customers increasingly choose the machine with the filter, because awareness has caught up. He draws the general rule from it: there is no business that can claim saving the planet is impossible for it.
What this asks of marketing
The interview is blunt about the old model. The traditional way of marketing is pretty much over. What replaces it is authenticity, meaning a clear account to the consumer of what the company is actually about. Where purpose is the business, the marketer has to live that purpose completely.
The difficulty is a commoditizing category. Many buyers are brand agnostic and want the refrigerator to cool and the washing machine to wash. Bulgurlu’s closing instruction to marketers is restraint. Getting closer to the consumer is dangerous, so the discipline is to find precisely when the consumer needs something and to be the answer then.
Organization, data, and what is still missing
The operating model is being pulled apart deliberately. The company will manage itself from three locations rather than one, to sit closer to its markets. Its factory in Romania is a lighthouse factory designated by the World Economic Forum, and it gathers data from 20,000 different points.
Two admissions sit alongside that. The leadership team needs more diversity, and Bulgurlu names it as the thing to improve. He also insists the solutions cannot be imposed. This work cannot be top-down, it has to be bottom-up. Asked to define leadership in one sentence, he answers that it means living what you say and becoming what you say.
Scope and limitations
This is one executive’s account of his own company, given in a live conversation, and it is not independently verified here. The speaker himself marks the incomplete parts. The company is far from successful by his own test of customer choice, it is a long way from integrating suppliers and customers, and it has only just started on the easiest reductions.
The source is an automatic caption track of a spoken conversation, so it carries no speaker labels and no reliable punctuation. Quotations here are transcription of speech rather than written text. The 2030 emissions commitment also depends on technology that does not exist yet, which the interview states rather than resolves.
Source
This page summarises HGS #36: Hakan Bulgurlu (CEO, Arçelik) talks about sustainability, purpose and transformation, by Institute for Real Growth.