SEP 9, 2014 ROTARY IN REVIEW:
Doug Baker, CEO, Ecolab

President Guthmann banged the Rotary bell with a firm hand followed by Jim Field, Minnesota Independent School Forum, leading the club in patriotic song accompanied by the twinkling tones of Billy Given, Prom Catering, on the piano. Jean Vukas Roberts, HealthEast Foundation, provided the invocation, Kay Baker, HealthEast-retired, took a significant bite out of the clock introducing the throng of visitors, PP Blake Davis,Davis & Lagerman-retired, promoted upcoming meetings and Scott Van, Van Paper, urged everyone to buy roses to support our foundation.

With his wife in attendance, long time member and one of St. Paul's most generous and kind benefactors, Andy Boss, was memorialized by PP Dan McKeown, Specialty Manufacturing. A grand friend of Rotary, Andy seemingly touched almost every part of St. Paul and where he touched he left a legacy.

PP Jim Kosmo, Padelford Riverboats-retired, announced that the 2014-15 Nominating Committee is being formed and will assemble the slate of candidates for the club's Board of Directors and officer positions. The committee includes Past Presidents Kosmo, McKeown and Doug Bruce, UBS Financial Services, and at Large Members PDG Ken Crabb, MD, Advance Specialty Care for Women, Mindee Kastelic, Saint Paul Area Chamber of Commerce, and Carley Stuber, Minnesota Children’s Museum Anyone interested in serving or suggesting a candidate may contact any of the committee members.

PP Kosmo also introduced our newest member, Patty Voje, owner of Spot Communications, a downtown St. Paul marketing/communications firm.

Mark Henneman, Mairs and Powers, introduced Doug Baker, CEO of Ecolab.

“ The US has one of the stupidest corporate tax systems in the world,” Baker said in response to Billy Given inquiring about Medtronic moving offices to Ireland to obtain more favorable tax treatment.

“Why don’t we just fix the corporate tax regime and stop all this nonsense.”  He continued adding, “There’s a lot of misunderstanding about this inversion.  Medtronic is going to pay the same US tax. It has nothing to do with US tax rates. Theoretically, Medtronic will owe money on their foreign earnings, but we are the only large industrial nation in the world that charges their corporations on foreign earnings. Nobody else has that.”  He outlined how failed US tax policy is forcing international corporations to invest outside the country to remain competitive in the global market.

CEO Baker noted that his company has $13 billion in sales with 1.3 million customers in 171 countries and 45,000 associates. The St. Paul based company has experienced incredible growth in the past two decades, thanks to it’s talented employees according to Baker.  As an executive you are only one person, he said.  You must bring in very talented people. “Your job is to clear the deck for your people so that they can make your life easier for you.  Ten people cranking can outperform one no matter what your opinion of yourself is.”

And, Minnesota is a great place to find talent, he said.  Recent research has proven what many of us have long believed—while it is often difficult to attract people to our winter wonderland, once they arrive they do not depart.  And, Minnesota ranks number one among all major metro areas for retaining its young people.

But there is trouble on the horizon, Baker said.

First we are headed toward a fresh water shortage.  Food production consumers 75% of our water and with our population expected to increase from 7 billion to 10 billion by 2050 there just isn’t enough fresh water, at least in the areas where we are trying to grow. “And, you can’t feed 10 billion people with local produce. We have sucked up the ground water and we will need to move production nearer to the water and then ship the food. That will be good for the US and Argentina.”

These conditions lead to the next major problem, he said.  By 2040 there will be a major discrepancy between jobs and a quality work force. We need to start now, he said, to build that workforce. He stressed that it will require greater attention to attracting young people and providing quality education, especially to minority groups.

Ecolab already gives $1 million year to St. Paul schools.  In combination with other regional corporations it works with Minnesota Early Learning Foundation (MELF) to provide $20 million for local education. “Our biggest issue is unequal opportunity. That creates unequal outcomes. We do have a big disparity in educational opportunities. Even black kids who come out and get good grades the likelihood they’ll go to a good college is quite low.  This achievement gap is the blood that’s on all of our hands.”

Ecolab, he said is good at making the world cleaner, safer and healthier. And, they have outperformed economic forecasts for 89 of the last 90 quarters. The result is that financial experts on Wall Street “trust us.” And, the company has outperformed the S&P by 297,000% since 1957. Baker suggested that anyone who can find a time machine travel back to 1957 and “go long on Ecolab.”

Jim Kosmo, Scribe