SkiEO: Vail chief makes jump from Wall Street to Pearl Street
Tuesday, May 27, 2008 at 8:15 am
In just over two years on the job, Vail Resorts CEO Rob Katz has warmed to his very public position at the helm of the state’s top ski company, emerging from the lucrative but relatively obscure world of a Wall Street private equity firm to grab numerous headlines directing Vail’s new-found environmental ethic.
His first day on the job in 2006, which Katz said was his hardest, he announced the company’s corporate headquarters would be moved from Avon, in the mountains near Vail, to a LEED-certified (Leadership in Energy and Environmental Design) building in suburban Broomfield between Denver and Boulder.
Katz followed up that move with a series of headline-grabbing green announcements, including the purchase of enough Renewable Energy Credits, or REC’s, to offset the company’s annual energy use of 152,000 megawatts at its five ski resorts – Beaver Creek, Breckenridge, Heavenly (Calif.), Keystone and Vail – as well as all of its hotels and retail outlets.
Then the company partnered with the U.S. Forest Service’s nonprofit National Forest Foundation to fund conservation projects with a voluntary $1 hike in ski pass prices. That was followed last year by the announcement the company would seek LEED Neighborhood Development certification for its new $1 billion Ever Vail hotel, residential and retail complex in Vail.
Last season, the ski company began serving natural Coleman beef and organic products in its on-mountain restaurants, and recently Vail Resorts sought permission from the Forest Service, which holds the lease on much of the ski company’s land, to install small wind turbines and solar panels atop Vail Mountain.
"The ski industry itself should be a leader on the environment because that’s what we are," Katz said. "The product we sell is an experience in the environment, so we really have a special opportunity, and of course we have a special obligation because we’re using the environment to make money."
Increasingly, though, that bottom line is being cut into by rising energy costs. Vail Resorts spends more than $25 million a year on energy, prompting Katz to announce in an email to employees last week mandatory "energy layoffs" aimed at trimming the company’s energy consumption by 10 percent in fiscal 2008. The email didn’t divulge specific energy-saving measures but did not include workforce cuts.
Conservation that positively impacts the company’s bottom line is something Katz, 41, can certainly relate to as a former partner at Apollo Advisors, where he invested in and served on the boards of numerous companies, including Vail Resorts when it first went public in 1997.
But Katz said green initiatives need to be much more than mere financial or political practices, even in an industry so dependent on cold and snowy weather.
"I am worried about climate change, but much more as a parent than I am as a CEO," Katz said. "Because, quite frankly, if climate change is going to take place, then this planet has a lot more issues to deal with than skiing, and the reason we should be doing the right thing for the environment is not because part of our product obviously is snow."
A graduate of Penn’s Wharton School of Business who grew up in New Rochelle, N.Y., and became a passionate skier even on the icy slopes of the Northeast, Katz right out of college worked as a mergers and acquisitions analyst for Drexel Burnham before that company went bankrupt in 1990.
He landed with financier Leon Black’s Apollo Advisors, which acquired a big chunk of Vail when then-owner George Gillett went bankrupt in the early ’90s. But Katz and his wife, Elana Amsterdam, had already started thinking about leaving Manhattan when 9/11 helped convince them Boulder would be a better place to raise their two sons.
Katz was living in Boulder, working part-time for Apollo and adjusting to life outside the rat race when then-Vail Resorts CEO Adam Aron stepped down in 2006. Katz said he was approached by board members who knew of his passion for the sport and wondered if he’d be interested. He said he was, but only if he could initiate significant change. The only resistance to his green push, he said, has come from those who question his motives.
"There are folks who are concerned about whether this is a political agenda, and one of the things that I’ve talked about a lot is that our company needs to do the right things to help prevent climate change without getting involved in a political debate about climate change," Katz said. "Of course, you’re going to get involved in politics, but if you [pursue green initiatives] through a political agenda, you can lose your focus on what the core purpose of your company is."
Katz said his wife has helped shape many of his environmental beliefs. Amsterdam grew up in Davis, Calif., worked for the Environmental Defense Fund, and started a recycling consulting business in New York City called Ecosav. A January Boulder Daily Camera guest column by Amsterdam entitled "Collision-course economy: consumption vs. conservation" describes her as an eco-preneur.
One of the biggest adjustments Katz has had to make in his transition from Wall Street to the Pearl Street Mall in Boulder, he said, is the high-profile nature of his new gig at the helm of one of the nation’s leading ski companies.
"The persona of this company is much bigger than its size would dictate, and that’s because it has a very big presence, first of all in the state of Colorado and within the sport, and also we have obviously a fair number of influential people who come [to Vail]," Katz said. "That kind of elevates the persona [of the company], and along with it my persona kind of gets elevated."
Part 2: Tomorrow, the critics charge Vail is merely following in Aspen’s footsteps and, thus far, has engaged in a very good game of environmental "green-washing."