Learning to Take the Right Risks
For Steve McDougal, CEO of 3Degrees, the seeds of his calling to take action on climate change were planted in the most unlikely of spots: the municipal recycling bins in his hometown of Evanston, Illinois. Back in the early 1970s, McDougal recalls, recycling had not yet gone mainstream, but his environmentally conscious mother could not imagine trashing all their household waste.
“We were the weirdos who would actually lug bags of tin cans and papers across town to dump them at the one recycling center in town,” McDougal says.
Those early seeds of environmental stewardship lingered, even as McDougal embarked on a career in sales and corporate marketing. At the time, he says, the notion of going “all in” on climate work was still rare.
“I just had this growing itch,” McDougal says. “I had to be doing something related to climate change. I just had to! I’ve got to do something that I really care about.”
McDougal was working for a well-known consumer electronics reviews and e-commerce website when he hit his tipping point. He suggested the company add a function to encourage and enable responsible recycling of electronics, but the pitch went nowhere. It was the moment he knew that he had to change course.
“I tried making my mark in a way that seemed like a no-brainer and failed, so I decided I had to do something else,” he recalls thinking at the time.
So, in 2003, McDougal joined 3 Phases Energy Services – a precursor to 3Degrees – as director of marketing and business development. He then went on to officially co-found 3Degrees in 2007. Over the years that followed, he helped lead the company from a small innovator in the renewable energy space to a global climate solutions leader.
3Degrees helps a wide variety of organizations — including mid-sized to Fortune 500 companies, as well as electric and gas utilities – develop and execute global climate and decarbonization strategies to meet their climate goals, including net zero. The company has a track record of groundbreaking work in the industry, including facilitating innovative renewable energy aggregations and driving advancements in transportation decarbonization.
It is work that drives squarely toward McDougal’s impact vision for a business community in which “every organization infuses climate considerations into its decision-making and knows that they’re being held accountable.”
McDougal’s seven years as CEO at 3Degrees have taught critical lessons about how to effectively manage toward that impact. Perhaps most importantly, he’s developed greater willingness “to take more risks in the right ways.” For 3Degrees and McDougal, that has meant allocating resources to initiatives that the firm believes could have positive social impact, even if profitability is uncertain. He cites the company’s collaboration with partners to bring a new renewable energy product, Peace RECs, to market as an example of this commitment and forward-thinking approach. Peace RECs, or P-RECs, are international renewable energy certificates (I-RECs) that support high-impact renewable energy projects in climate-vulnerable countries. The company recently facilitated the first repeat P-REC purchase by Microsoft in the Democratic Republic of Congo, and McDougal recalled the complex process of helping make an innovative idea real.
“We started that process saying, ‘We think we can do some good things here that we think will have an impact, and we have no idea if they’ll make any money,’” McDougal says.
The P-RECs experience dovetails with another important lesson that McDougal has learned about effective impact leadership: finding the ways for your organization to uniquely provide value. Because other firms do similar work, McDougal believes it is essential to pursue the areas where 3Degrees can offer their customers something unique. The complex process of bringing a new impact-focused product to market, McDougal says, shows 3Degrees’ unique ability to commit to deep and thoughtful partnership with their clients to achieve impact on climate change.
During his time as CEO, McDougal is always learning how to more effectively lead an impact-focused team. Most significantly, he has become adept at listening closely to employees who bring diverse views, even when those views differ from his.
McDougal also recognized how important it is for his team to understand that he shares their commitment to impact. As such, he has learned to speak with intentional authenticity, demonstrating that he cares about 3Degrees’ mission just as deeply as everyone else. That leadership lesson has proven especially critical during 3Degrees’ rapid growth, when new hires are acquainted with the values that have shaped the firm’s history. He speaks to every new hire during the onboarding process, sharing the history and values of 3Degrees.
“Sometimes, you think – ‘Oh, of course they know me because I’ve been around,’” he says. “But you forget that, as a growing organization, a lot of people don’t really know me. And maybe they’re used to companies that maybe talk the talk, but I want to ensure they know we work hard to really walk it.”
In keeping with his impact leadership lessons, McDougal and the 3Degrees board – alongside the company’s employees – last year adopted a social mission that complements the firm’s core climate focus. In the years ahead, 3Degrees will work to build justice into their work, striving to make the transition to a low-carbon future one that more equitably distributes the benefits across all communities.
For McDougal, the added focus is a natural evolution in the firm’s commitment to making an impact.
“Part of that is putting your money where your mouth is,” he says.