MGM Goes Green: C-Suite with Jeffrey Hayzlett

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Oct. 29 (Bloomberg) -- Bloomberg's Jeffrey Hayzlett travels to Las Vegas to talk with the executives at MGM about their new mission to go Green. CEO Jim Murren tells Hayzlett why his casino company decided to build the largest LEED certified building in America. (Source: Bloomberg)

I'm in las vegas.

I will talk to the c-suite of mgm.

Customers are demanding it.

Employers are demanding it.

The employees had to do things.

Kool-aid.

The electricity alone is -- a day.

We take an environment like this and turn it into a profit center.

Talk to me about your bottom line?

Energy is the gift that keeps on giving.

I cannot believe i'm hearing this from a casino.

I am jeffrey hayzlett.

I'm a journey -- on a journey inside some of the biggest brands in america.

I have been a cmo, ceo, and boardroom cowboy.

None visiting others to see how they tackle challenges of the c- suite.

We are in las vegas at the mgm.

We are in sin city.

The slogan for the city is actually what happens in vegas, stays in vegas.

I want to know how a $9 billion company like mgm has a moral compass.

Mgm is pushing sustainability in being green.

Is it windowdressing or a neon sign to lure people?

Have the perfect couple.

They are in the middle of the desert.

It isn't isolated company.

-- it is an isolated company.

They could say, it is vegas, baby.

Take the money and run.

They are talking about kilowatt savings and gallons of waters is saved.

I want to know if the customers are going to buy this and whether the employees could sell it or if they are only doing the minimum because they have to or they are doing more than that and does it pay off?

Mgm's c-suite is located just behind the bellagio.

$1.6 billion to build.

It is hard to believe the same company that had such an excessive project is pushing sustainability.

This is your office, right?

This is pretty good.

It is good to be the boss.

[laughter] that is a good point.

A lot of people think sitting in the c-suite is nice all the time.

It is not always that way, is it?

The job was very un-fun for about three years.

We almost went and grabbed.

The scars have not yet -- we almost went bankrupt.

The scars have not yet healed.

We got through that.

That near-death experience is what drives all of us.

It drives me.

It is almost like a guy who has a heart attack and comes to and says he will do the rest of his life better or different?

Exactly like that.

A person looks at life in a completely different way.

It is the biggest impact they can possibly can.

That is mgm.

Sustainability -- when did it become an idea in your head that we will do this?

Did thousand one or 2002. -- 2001 or 2002. i had seen how far the water levin had fallen.

It really struck me.

When i came up with the idea, one of the cornerstones of that was sustainability.

This idea we could not only provides a great form of entertainment, but invoke knowledge as well.

A decade later, we will not bill without sustainability as a cornerstone.

-- build without sustainability as a cornerstone.

District is synonymous with bright lights and neon signs.

I am heading to a different place.

Most c-suites i hear ceo, cmo, but not she sustainability officer.

Lead the way.

Mgm's chief sustainability officer is showing me around a highly efficient come a point to billion dollar such a plan that fuels the city center.

The biggest leed center in america.

I read that the sierra club says you guys have taken steps in the right direction.

What does that make you feel like when you read about someone from the sierra club?

Makes me feel like they are doing their homework and they see genuine commitment from corporations.

A lot of corporations talk about what they are doing and they do a lot of media and so on about the green effort.

Here at mgm, you see we are the real deal.

That is what a lot of people say.

If they criticize you or the company, come on, all of this is just wenzhou -- windowdressing.

When you produce your own electricity, we used that for domestic water.

What do you see that?

In our capital investment, for every dollar we put in, we have about a 360% return.

Big numbers.

Energy is the gift that keeps on giving.

It is not a restaurant we are investing in and hoping customers will show up.

This is a return that is based on measurement.

We measure it.

I have got this technology that will pay for itself in a year and two months.

I will invest this money.

I have one at mandalay bay right now.

$400,000 investment in a central plant.

Will pay itself back in 15 months.

I'm checking out the city center, the largest project in history to obtain leed status.

It might be the model of sustainability, but has still got the glitz and glamour of vegas that i'm used to.

What are these plaques?

The plaques themselves represent mgm resort being a leader in the world.

What does that represent in terms of dollars?

In nevada, we had a generous tax incentive to build this complex green.

It looks chic and hip and very cool.

It doesn't have that look of green, but it is green.

How do you do that?

We set we would not design something where people walk in and think this is the back to nature building.

It is not birkenstocks.

It was very subtle.

She is a nature kind of girl.

Even with the chrome and the lights, you can get a nature feel to it.

We can.

That is the bottom line.

Which is the bottom line.

What i'm talking about is business.

How this $6 billion grab you?

? what brings people to vegas and keeps resorts like the mgm profitable is the glitz and the glamour.

It is up to the mgm chief officer to maintain that balance.

I think about marketing and sales.

We have this pyramid in the middle of nowhere.

This is the land of a little bit of make believe will step how do you make sustainability a legal bowl or sellable?

A couple of things.

The pyramid was built when vegas was all about themes and attractions.

It worked and continues to work host that we sit here 20 years later.

We have change, people have change, consumers have changed.

Sustainability matters to our customers and employees and ultimately, to us.

We recognize it is sin city and all of the cliches about it.

It has never mattered more.

They do not ask, but demand that we have sustainable programs and environments that help protect their brand and our brand and the environment.

To credit where credit is due.

To thousand five and 2004, we decided to have the leed gold standard.

-- 2005 and 2004, which decided to have the leed -- we decided to have the leed standard.

Does leed mean anything here?

When you look at what has been accomplished, that is a competitive advantage.

Do you use those?

Do where the mud badges on your jacket?

Lex we promote them.

We did at a time when it was not required.

-- we promote them.

We did it at a time when it was not required.

It is good for business.

Half of our clients today would not be here if we had not focused on it and made it an issue and made a difference.

What number is that?

7, 8, nine percent of our makes.

I can't believe i'm hearing this from a casino.

We are an entertaining company, not a gambling company.

At the end of the day -- 70% at the bellagio is not entertaining -- is not gambling.

It is entertaining.

People demand it.

Consumers demand it.

Hopefully we can deliver on it.

With the new focus on sustainability, mgm is charged with a balance.

Do not ostracize the consumers who are used to the old vegas lifestyle.

Hello.

How are you doing?

I was invited to the c-suite ballroom at the mandalay casino to talk about how they talk about the mgm emphasis on responsibility.

I'm at home sitting here in the mandalay bay shark reef.

I can imagine when you first started selling the green angle in vegas, sin city, people had to look at you like you had -- was that the case question mark -- like you had two heads.

Was that the case?

We spoke to customers about our great efforts and initiatives.

Literally at one of the meetings, i was laughed at.

I could not get their attention.

It was like, seriously?

It is now expect it -- expected.

They take it seriously.

With all of this talk about doing the right thing, how important is that to selling and filling up the convention center?

It is vitally important that we have groups that are coming constantly and are asking what we do.

They have their own sustainability mission statements.

They expect that whoever they do business with to have the same thing was that we are very proud of what we have done in the city of excess.

Where are you seeing customers ask whether you are green or not?

Will reopen the city center, we market ourselves as a sustainability building.

Going after the convention, we would get our -- people would make us check off everything.

In the past year or two, i had become almost an expectation.

There are companies, pleated or not, that will not do business in buildings that are not sustainable -- believe it or not, that will not be business in buildings that are not sustainable.

I would expect that a lot of your sales people, all due respect, which are belly rubbing people.

A little bit of schmoozing.

When someone said you will be the biggest leed certified, what is leed?

It does sound like a sales pitch.

Employees have to do things at a certain standpoint.

You have to drink the kool- aid.

Green kool-aid.

Exactly.

[laughter] how do you measure success here?

I would say it is measuring the amount of waste that we reduce.

Measuring the energy we use and how that gets reduced over time.

That is what helps us know that at some point we will make a difference and make vegas sustainable.

I do not know if i will believe that they guess is sustainable, but i will hug a tree like anyone.

When talking is biggest nash this this -- what i am talking about is business.

Talk to me about your bottom line?

Heide $6 million -- how does $6 million sound?

A good start.

[laughter] are you one of those cfos who checks the garbage to see if they are throwing money?

It is something you have to do.

? idealism is a lecture he in the c-suite.

-- is a luxury in the c-suite.

Profit is a necessity.

We are in this convention center.

What does this look like to you?

Cash flow.

Lots of people with money.

This is the best case scenario was to a full convention center that drives the heart of the mandalay business.

You guys talk a lot about sustainability.

What does that mean to you?

The efficient use of scarce resources.

We take that approach every day whether it is a convention center or in the tower.

We create a lot of opportunity to be resourceful.

I look at it as a business.

The more efficient we are in resources and using our resources, the more efficient for the bottom line and profitability.

We take an environment like this and turn it almost into a profit center.

There is a market.

We take the cardboard and recycle it and sell it on the market.

You're one of those cfos who checks the garbage to see if you're throwing away any money?

Absolutely.

China, linens -- we are recycling that.

That does not summit a flashy kind of business.

-- that does not sound like a flashy kind of business.

No.

it is a dirty business, but it is something you have got to do.

Is that money?

Yes.

We save money during the first year alone this by recycling.

Mgm is las vegas.

How can a brown so tightly city or an out of excess thrive on using -- how can a city that thrives out of access thrive on using less?

Expenses should be quantifiable.

We can quantify how much water that we save and how much electricity we can safe and how much money we can save in terms of maintenance.

To do something right and do it in a high-quality way without fixing things every two years.

On the expense side, it is easy.

On the revenue side, it is hard.

People booking and saying, i care that you care about sustainability.

Are they doing that because it is something they believe it or because it looks good?

May be in the beginning it was something that it looked good, but now they believe in it.

I know that we have received at least 200 or 300 conferences and conventions occurs that has been the primary differentiator.

It is a very competitive market.

If that is the case, 200 or 300 conventions, that is big money.

Why isn't the competition doing the same thing?

They are.

Up and down the strip.

That is good.

The largest taxpayer in the state.

We can provide leadership in terms of these practices, we will be able to handle the competition anyway.

Is any place we have got the most perfect cover to say we do that?

Why do it?

I'm a shareholder.

Earn me profits.

To be honest, i think a lot of that happened before.

People would come here and make as much money as they could and get out of dodge.

But it is growing.

There are multiple generations now.

People that have planted the roots here.

I feel very strong that as it becomes a part of this community, this community deserves more.

Yes, it is a tourist place, but it is also a great place to live . i learned during the recession that a company -- i do not care what company you are or whatever industry -- you do not have a sustainable business model if your community is not sustainable.

We can be the strongest company on the planet, but if you are in an environment that is deteriorating, you will not succeed long-term.

I came to the desert with the big questions, about a company raising the ante and placing about corporate responsibility.

At the end, las vegas, not is the norm.

-- naiughtiness is the norm.

Going green lowers the costs and tax bills, but it also raises the company's reputation and allowing it to win new business.

In a city where the competitive convention market, you can attract fines looking to be

This text has been automatically generated. It may not be 100% accurate.

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