Going soft on sustainability
Sustainability: “conserving an ecological balance by avoiding depletion of natural resources”
If businesses compete so aggressively in the commercial arena, why do they go soft and friendly when they start talking about sustainable development? This is the question that Tony Simons, Director General of the World Agroforestry Centre, posed to business leaders at a recent conference on the green economy. He was speaking at the International Conference on Sustainable Business and Consumption in Bonn, 27-28 November 2012. “If businesses really were committed to the concept,” he said, “those making real efforts to operate sustainably should use that as a competitive edge to drive unsustainable operations off the market.”
This provoked some interesting reactions. For example, a sustainably produced carpet might generate 5 g of carbon dioxide per kilogram during manufacture while the ordinary process might generate 30 g/kg, but both carpets are taxed at the same rate. It is regulation that will change the market, as well as investor pressure. Customers make their own decisions. It is a lengthy and painful process to move consumers and decision makers towards more environmentally friendly habits. However, it can be done. People in many developed countries routinely separate and recycle their household waste, even it takes a bit of work, and consumers are prepared to pay extra for organic food. Legislation was needed to drive recycling; advertising and campaigns raised people’s awareness of the benefits of organics.
We were in august company at this conference. Via a video link, HRH the Prince of Wales Charles asked us “How do we work together to take an existing cultural approach that encourages ever greater levels of mass consumption and transform it into a much more intelligent, responsible use of the Earth’s precious and diminishing natural resources?” A lengthy question that the conference participants sought to answer, perhaps motivated by the Prince’s comment that “Present-day agriculture is costing the Earth too much.”
Dr Auma Obama, Barack Obama’s step sister, is also a president, of the Sauti Kuu Foundation, which is working to give homeless children in Kenyan slums an education, a voice and an opportunity to become part of society. She said that sustainability is both a challenge and an opportunity for the business community, because “true sustainability is not possible without socioeconomic development. Before sustainability comes economic development.”
Businesses have hundreds of millions of dollars in their corporate social responsibility budgets and they are looking to safeguard the survival of their businesses into the future. Many of them, even the largest, are looking far into the future at ways to guarantee the need for sustainable supplies of essential raw materials at reasonable prices, such as the pulp and paper industry.
Puma, in a combination of altruism and good business, is introducing sustainable supplies and manufacturing practices throughout its multi-billion dollar enterprise. At the same time it is eliminating all unfair labour practices in its developing country factories. Jochen Zeitz, the Chair of Puma, said, “We need to tax resource exploitation rather than the goods themselves. “
Such market forces can play a positive role in development. Once a status symbol, the mobile phone has revolutionized the way that developing country farmers and communities market their goods and produce. So some elements of consumption are empowering local people. However the current vogue for Fair Trade goods in developed countries is, in fact, dictating conditions to developing country. In this case it is telling farmers how to grow their crops. Free trade, especially the abolition of unfair subsidies in Europe and the United States, will allow developing country economies to grow.
Inevitably it will be the developed countries, their powerful economies and their governments that will move sustainability into a common world priority. Marlehn Thieme, the Chair of the German Council for Sustainable Development, is working to incorporate sustainability into German society. She defined it as the “long term preservation of the means of livelihood.” No government can achieve its carbon dioxide standards under the Kyoto Protocol without the support of its people, because they cost money. However eight out of ten German citizens want a new economic order that takes greater account of social equity and environmental considerations. And they are prepared to pay for it.
“Sustainability needs to be transferred to the 9 billion people on the Earth,” said Thieme and asked “Is the business world prepared for the coming uncertainties and conflict laying in wait in the future? Can we make sustainability into a hard economic topic, where money flows and money grows?” He thinks yes, because the volume of sustainability funds grew by 26 percent to 2 billion Euros in 2011.
Ramon Arratia of Interface EMEAI UK said that his company has cut their direct carbon emissions by 71 percent in Europe, but the supply chain has an impact on sustainability. All those companies supplying raw materials and components need to be working sustainably. So there is a need for full product transparency.
The equation also goes the other way. Unilever has found that 68 percent of the carbon losses in its product chain comes from the consumers themselves, in heating hot water in their houses. But how many people will take a cold shower for the sake of sustainability?
Ewald Wermuth of IDH, the Sustainable Trade Initiative, talked about bringing an apparently unmanageably challenge down to size. WWF found that just 15 commodities adversely affect biodiversity hotspots. Over 200 global companies involved in their trade, but only 50 companies have a major impact. So IDH is aiming at just these 50 companies . All are concerned about future supplies. “Convincing 30-40% of the marketplace is a tipping point to get sustainability as a major factor in product development,” he said.
Reinforcing the general sentiment that business as usual is completely unsustainable, Pavan Sukhdev, founded Corporation 2020, a campaign dedicated to transforming today’s corporations into engines of tomorrow’s green economy. In plenary he said, “Despite all the global problems, corporate profits continue to increase. Business as usual by the top 3000 companies costs the world US$2.1 trillion from ‘negative externalities’ such as emissions and pollution.” These megacorporations are global arbitragers of resources. Many of them created consumerism, so with the right leverage they can also create responsible consumerism and align their goals with society.
Which brings us back to Tony Simons. During a discussion panel, he talked about the involvement of World Agroforestry in the cocoa industry in West Africa, which grows 70 percent of the world’s crop. A participatory project with Mars Inc. is having a drastic effect on cocoa production and earnings in Côte d’Ivoire. Trees that used to produce 3-4 poor-quality pods per year are now producing 40 good-quality, and hence valuable, pods. As a driver, Mars has used the production level of 1000 kg per hectare as a certification criterion, to guarantee a fair income for the farmer. This combination of enlightened self interest with social and environmental action is driving innovation in the area. “If it is not done, the cocoa industry will collapse,” said Simons. And none of us want that, do we?
A number of sponsors of the conference also agreed on a declaration, which “summarizes the elements of shared convictions of the endorsing SusCon networking partners and serves as an appeal to promote the development of an economically, socially and environmentally sustainable future for our planet as well as for present and future generations.” The text is given below; see also here.
SusCon´s Bonn Declaration
Due to our commitment to sustainable development we – 11 organising and networking partners of the 3rd International Conference on Sustainable Business and Consumption (SusCon) held on 27 to 28 November 2012 in Bonn, Germany – met with representatives from civil society, business, government and the United Nations to promote the development of an economically, socially and environmentally sustainable future for our planet as well as for present and future generations.
We declare our conviction that
1. the model of growth and prosperity that has dominated in the Western world since the industrial revolution is no longer an acceptable model to live by. It is clear that this economic pattern, along with Western consumer habits, must change if equality on a global level is to be achieved. To do so the increasing scarcity of resources, the growing world population (predicted to reach eight billion by 2025), and the present inequalities of political and economic power must be taken into account;
2. the primary sector (e.g. agriculture, forestry, fishing) and its value chains has an enormous effect on the economic, social and natural environment, as well as on human health. Consequently, we consider the primary sector and its value chains are the decisive factor in achieving the fair and sustainable coexistence of mankind;
3. collective action across all levels and groups of society is essential. The current business model must be abandoned and we need to work together to reinvent a model that is both sustainable and economically viable;
4. business is the main driver and promoter of today’s unsustainable paradigm. Private enterprise should take on the responsibility by running business operations according to sustainability criteria;
5. political and economic framework requirements need to be adjusted so they encourage businesses to adopt a decisive role as “agents of change” for sustainable development;
6. the public sector along with financial service contractors, such as banks, associated companies and insurance companies, are the key drivers for enabling the fundamental transition from the present economic model to a greener economy based on sustainability and resource conservation;
7. Consumer Social Responsibility must complement Corporate Social Responsibility;
8. a Green Economy has to be based on a strong social pillar and that we need to integrate social and cultural influences alongside ecological issues; and
9. in the light of individuals, think tanks, scientists, NGOs, companies, international organisations and governments that have already begun to map the necessary paradigm change, we will further accelerate this process by acting as a conduit for more links between actors; but we also acknowledge that we will have a role in pointing out deficits.
We believe the public and private sector must
1. accept responsibility and understand that sustainability should be part of a long-term corporate strategy;
2. create clear frameworks and effective market conditions on a national and global level, that incentivize sustainable business and prevent ecological damage;
3. ensure sustainability goals are established and supported, with smallholders as key actors for change in the primary sector;
4. invest in resource-efficient projects;
5. mobilize resources to help fund actors that are without other financial means, most notably smallholders and small and medium enterprises (SMEs);
6. prohibit acquisitions of land for the purpose of exploiting natural resources for exportation without benefiting the local population, and make investments in land and other scarce resources that provide opportunities to combat poverty, enhance local cultures, and ensure food security – a vital component of any bilateral or multilateral agreement (public and private) such as the WTO rules;
7. ensure that natural resources – like water, biodiversity and timber – are used in an environmentally and socially responsible ways, and ensure the value of ecosystem services are taken into consideration by introducing payment systems that fully compensate their utility;
8. use their available resources – for example companies and advertising agencies should use their budgets and professionals – to communicate and promote sustainable products and new business models such as “Collaborative Consumption” in an attractive and responsible manner, while standing up against practices that consciously deceive consumers; and
9. ensure that public and private procurement policies consider sustainability criteria as core preconditions for their purchasing decision.
Bonn, Germany 28 November 2012
The Declaration is endorsed by:
SusCon Organizers: COLABORA Let’s work together, forum CSR international;
Organic Services GmbH international consultancy
SusCon Partner Network: FiBL (Research Institute of Organic Agriculture), The Forest Stewardship Council (FSC), International Federation of Organic Agriculture Movements (IFOAM), Naturland e.V., Rainforest Alliance, Soil & More International BV, World Agroforestry Centre, WWF Germany.