This blog is a companion piece to the excellent overview of the Purpose Pledge program that is being published simultaneously today by Les Szabo, Chief Strategy and Impact Officer at Dr. Bronner’s, who has been the main driver and architect of the program.
Purpose Pledge is for agriculture-based consumer product companies that want to sell products in a way that is fair to all stakeholders, including all of the people, land, and animals involved in raw material supply chains, as well manufacturing. We’re beyond grateful to our major partners in this effort—OSC and Lift Economy—as well as all the amazing Purpose Pledge pilot brands.
Here I want to augment and share the innovative precedent-setting approach that Purpose Pledge is taking to the Living Wage, Supply Chain Integrity, and Climate Action commitment areas. These commitment areas involve real cost implications for participating companies, demonstrating commitments that are robust and credible, but also realistic and achievable.
The first overarching point to emphasize, is that the Purpose Pledge gives nine years for companies to achieve their commitment areas and gradually build these higher costs into their operational cost structure, though commitments can be met sooner.
Purpose Pledge Commitment #5: Living Wages & Decent Livelihoods
Starting with Living Wage, we take the view that all workers in America should be able to make ends meet for their families on the wages they receive in a 40-hour work week, and not have to work a second job or rely on food stamps and housing assistance. Companies that pay sub-standard wages are basically taking advantage of public welfare with their unethical business models—turning public welfare into corporate welfare.
In the past year, I’ve had the honor and pleasure to get to work closely with Michelle Murray, founder and CEO of Living Wage for US, along with the awesome Purpose Pledge pilot brands, to build the Purpose Pledge approach to paying fair wages. Living Wage for US defines an “all in” living wage based on hourly income, plus benefits that 1.75 working adults with two kids need to receive to make ends meet in the lowest-cost county that is commuting distance from the workplace. If a company’s pay scale for their lowest paid position gets to a full living wage within five years of tenure, and in the first year of hire is two thirds of the full living wage, corresponding to the cost of living for a single adult with a roommate and no kids, they are considered a ‘fair wage employer.’ While at Dr. Bronner’s we already pay a living wage for our lowest paid position based on cost of living in Riverside County, we also appreciate that like many companies, including Costco, we have a five-year pay scale for our hourly positions. At Costco, cashiers in their first year of hire make $20 / hour plus benefits, and then every six months they get an additional dollar an hour added, topping out after five years at $30 / hour. With a reasonable benefits package, this would be a living wage pretty much anywhere in the US.
Living Wage for US converts an employer’s full benefits and compensation package to an annualized total and an hourly equivalent. For example, a good family health care plan might cost $4 / hour. A reimbursable childcare credit is a particularly economical way for employers to close any gaps to a living wage, as the actual utilization of the benefit is generally not more than 15% of the workforce at any given time, and few employees max it out. For example, at Dr. Bronner’s we match up to $5,000 for one child, or $7,500 for two or more children. We had 360 employees in 2024 and that year we paid out $174,000 in childcare benefits total, which on average per employee is $483 / year or $0.23 / hour, but in our calculation with Living Wage for US we are credited the full amount of $7,500 or $3.60 / hour additional per employee. Bonuses, retirement, meals, and other fringe benefits are all counted. Companies have nine years to achieve a living wage for their employees and can incrementally raise the base cash wage year over year or introduce benefits like a reimbursable childcare credit, to close the gap over time.
I personally think that federal and state minimum wages should be flexible and based on local cost of living, equal to two thirds of a family living wage, corresponding to the cost of living for a single adult with a roommate and no kids, in the lowest cost of living county that is commuting distance to work. By that definition, an employer would be considered a living wage employer if they have a pay scale such that by year five of tenure an employee in the lowest paid position is receiving the full all-in family living wage.
I’m also excited to work with Living Wage for US as they build out their global wage map next year. This means we will audit our major supplier partners across the globe to identify any gaps to a living wage in local markets and develop a plan to close any identified gaps. For relatively larger companies like Dr. Bronner’s, where we are a majority customer of a given supplier, this audit will be fairly straightforward, but will not be something Purpose Pledge will require for smaller companies. Nonetheless, I’m looking forward to also working out a program with Living Wage for US to address suppliers where we are not a majority customer. Take the case of our plastic bottle supplier: we could still have Living Wage for US assess their gap to a living wage, and then we pay into a bonus fund for their employees equal to the proportional share of business we represent. For example, if we represent 10% of their business and the overall gap to pay their workforce a living wage is $2 million, then we would pay $200,000 into a fund that would be shared with all employees. There are different controls and issues to consider, but with a critical mass of customers choosing to do this, it would be a straightforward way for suppliers to raise all wages.
Purpose Pledge Commitment #3: Supply Web Integrity
Turning to supply chain integrity, for ecosystem, climate, and human health, we need to shift agriculture globally to a regenerative organic basis, and stop using huge amounts of synthetic fertility and pesticides that are poisoning our bodies as well as soils and ecosystems, driving in significant part the sixth great extinction event we are causing. Purpose Pledge requires that third-party certifications be in place that holistically address soil and ecosystem health, fair prices and wages, and as applicable, animal welfare (which must be raised in true pasture-based systems only), layered on top of a baseline organic certification. By year 9 of making the pledge, 80% of a company’s revenue must be certified to contain at least 70% certified content. As a founding partner of the along with Patagonia and Rodale, ROC is the primary third-party certification vehicle that Purpose Pledge companies will use. However, if a pledging company wants to layer on accepted soil health, animal welfare, and fair labor trade certifications on top of USDA organic, that would also be acceptable.
Purpose Pledge Commitment #8: Climate Action
This leads into our climate action commitment. Purpose Pledge is working closely with Project to help companies measure their emissions, set science-aligned emission reduction targets, work to meet those reduction targets within their value chain, and beyond the value chain invest in climate solutions elsewhere that reduce emissions and sequester carbon through a Climate Transition Budget assessed based on total emissions footprint and an agreed-upon price on carbon. Pledging companies will measure their scope 1, 2, and 3 greenhouse gas emissions, where scope 1 refers to direct emissions, scope 2 refers to electricity purchased, and scope 3 involves all the emissions involved in every other aspect of the business and their supply chains. Generally, for an agriculture-based consumer products company, scope 3 is where the vast majority of emissions are generated, often in orders of magnitude (about 10 to 90 times the emissions of Scope 1 and 2), reflecting the material impact and importance of attending to supply chain integrity. Under Purpose Pledge, in the early years of commitment, an initially low cost of carbon is assessed on a metric ton basis, and gradually increases to $25 / ton by year nine of taking the pledge. Multiplying the company’s emissions in metric tons by the assigned price of carbon equals a company’s annual Climate Transition Budget (CTB), which must then be spent in approved ways to reduce emissions, such as transitioning supply chains to organic or regenerative organic, electrifying operations, etc.
Converting supply chains to regenerative organic is undeniably one of the most important steps an agriculturally-based company can take for the climate. Synthetic nitrogen alone, made from fossil fuels, has a massive emissions footprint, while regenerative organic practices build soil health and fertility while sequestering atmospheric carbon into soils. Under Purpose Pledge, the price premiums paid for organic or regenerative organic forms of ingredients compared to conventional count towards the CTB but are capped at 75%; at least 25% of the CTB must be spent otherwise, for example in using renewable energy. This approach strongly incentivizes and rewards the conversion of supply chains to a regenerative organic basis. We have seen too many major organic brands choosing to source conventional ingredients under new ownership, and it’s ridiculous if those companies can still be considered Climate Neutral.
All the commitment areas of Purpose Pledge are crucial to demonstrating elevated leadership in today’s consumer products industry, but these three commitments in particular—Living Wage, Supply Chain, and Climate Action—are high stakes both financially and for the planet. We hope the strategic, meaningful, innovative approach we’re adopting here will inspire more companies to join us and take the pledge!