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The fact that the
World Resources Institute just hosted its Sustainable Enterprise
Summit for the sixth time is proof that the juxtaposition of sustainable
development and business corporations is becoming a lingua franca
in today’s world. During the two-day conference, which was
held in mid-March in Washington, DC, nearly 200 corporate, government
and NGO attendees, all with their PowerPoints and brochures, talked
about green initiatives, corporate sustainability and emerging markets.
Throughout the two days, keynote and plenary speakers discussed
the necessary frameworks in which new leaders and markets for sustainability
could thrive, while breakout sessions including “Corporate
Venturing in Emerging Markets,” “Policy as a Market Accelerator,”
and “Developing Sustainability Strategies” showcased innovative
approaches to incorporating sustainability into operational strategy.
One of the case studies was the success of the Brazilian company
Natura Cosmetics in working with indigenous communities in the Amazon
to develop products based on the local traditional knowledge, while
at the same time becoming the largest cosmetics company in South
America. Peter Zollinger, executive director of SustainAbility and
an expert on corporate governance, presented similar success stories
in the Czech Republic, South Africa and China.
But while the meeting had as its stated goal the practical question
of how to translate vague concepts of sustainability into applicable
business strategies, some key participants, most of them WRI board
members, raised fundamental questions about political and business
practices that hinder such lofty goals from being achieved. These
questions echoed throughout the summit.
The first was David Gergen, bi-partisan presidential advisor extraordinaire,
perennial pundit and, officially, professor of public service and
director of the Center for Public Leadership at the Kennedy School
of Government, Harvard University. Confessing to not being as well-informed
about green topics as other participants, Gergen brought up issues
regarding the current political and business environments and how
these affect plans and policies that may, or may not, be put in
place.
As far as corporate leaders are concerned, he said, there is no
mechanism in Wall Street or elsewhere in the financial world to
recognize the value of a triple bottom line (financial, social,
environmental) business strategy. Even though going green can be
good for the bottom line, it does not (yet) raise the value of a
company’s stock on Nasdaq, thus it does not provide a fundamental
reward in a language, and through mechanisms, that any CEO can easily
grasp. So, while the sustainable development gospel keeps finding
more and more converts, until its tenets are made into the “law
of the land” no fundamental change can really be said to be
in place.
“This is what happened with civil rights,” remembered
the North Carolinian Gergen. “First the good people came around,
but then a national law was needed.” Such legislation, he concluded,
though overdue is unlikely to happen in the current political climate.
Most CEOs, added another panelist, only act if, in the short-term,
it is good for the bottom line—or if the law mandates. With
Wall Street not rewarding the bottom line for green initiatives
and with the current federal government in no mood to increase business
regulations, there is little hope for significant change in the
near future.
Keynote speaker and WRI board member Senator Jon Corzine (D-NJ)
echoed Gergen’s message, emphasizing its political ramifications.
“I’m troubled that this isn’t the front-burner issue
that it should be,” stated Corzine, former CEO of Goldman Sachs.
“Traditionally, these have been bipartisan issues. Nixon was
the grandfather of our environmental laws. But now what we see is
a reversal, backing away from progressive initiatives. We need a
climate change in Congress to be able to move legislation, but until
the 2004 elections not much is going to happen other than occasional
initiatives. Sustainability policy is not a top priority of our
fiscal policy. We have to make it a ballot-box issue and demand
that political candidates speak out about it.”
During a plenary discussion on “Building Public Trust,”
the influential role major corporations play in setting the political
agenda was the topic of one of the panelists. James Harmon, chairman
of the investment bank Harmon & Co. and former president of
the Export-Import Bank of the U.S., reminded the audience that “some
of the best companies [in terms of sustainable development initiatives]
are among the worst lobbyists” working against any form of
governmental pro-environment regulations. “In case after case,”
he said, “money makes the decision.” Then, looking to
the packed audience, he added, “Some are here.”
This theme of profits and/or a real commitment to sustainable development
principles was highlighted time and again during the summit. As
when David Buzzelli, retired vice president and director of Dow
Chemical and a WRI board member, recalled on another panel how during
his time at Dow it had reduced the number of waste incinerators
by 70 percent in 10 years, he was reminded by Linda Greer, a fellow
panelist and senior scientist at the Natural Resources Defense Council,
that a very successful pilot project she had developed at Dow had
not been picked up by any of its managers for permanent implementation,
despite all the kudos she had received from those same managers.
Likewise, when Randy Overbey, president, Energy Division of Alcoa
and WRI board member, gave the event’s corporate keynote speech
underscoring Alcoa’s commitment to sustainable development,
he was questioned by a representative from Greenpeace as to Alcoa/Australia’s
opposition to the Kyoto treaty. He responded that Alcoa abides by
the government rules in each of the countries in which it operates,
adding that if the Australian government adopts Kyoto, for example,
it would inevitably raise energy costs.
Another participant in the last plenary discussion, Yolanda Kakabadse,
president of World Conservation Union and a WRI board member, touched
a chord in the room by noting that public perception would shift
dramatically if business decisions fully demonstrated their companies’
commitment to integrated social and environmental considerations.
“The environment is a social issue,” she said, “we
are talking about and affecting people’s lives.” Author
David Batstone, professor of Social Ethics at the University of
San Francisco, added that a change in the currently accepted business
model is required. “With corporate leaders deciding beforehand
the profit margin that their business must generate, it is impossible
to make the system work,” he said. To check the real commitment
of any corporation to its stated sustainable development principles
is easy, added Batstone, “just see what they are keeping track
off; what’s important is what gets measured.”
In an earlier session, WRI senior fellow Matt Arnold tied these
ideas together by suggesting that aligning sustainability principles
in corporate strategy, operations, policy, design and technology
was the key to success. Too often, he argued, organizations undermine
sustainability by supporting opposing political strategies. This
despite a previous presenter, Hal Brill, president of Natural Investment
Services, having demonstrated that not only has socially responsible
investment grown from $630 billion in 1995 to $2.3 trillion in 2001,
but that stocks from socially responsible companies have been consistently
outperforming the market.
“It is important,” said WRI’s Sustainable Enterprise
program director Liz Cook, “to show that a sustainable business
model can succeed.”
| SUSTAINABLE ENTERPRISE SUMMIT ON-LINE |
WRI’s sixth annual Sustainable Enterprise
Summit showcased leading corporations and strategic partnerships
that transform vague concepts of sustainability into concrete
actions. The conference focused specifically on actions that
support new “green” markets and that train business
leaders to manage for sustainability. WRI introduced a new feature
to the structure of this year’s summit; many of the sessions
were supplemented by tools sessions that were designed to equip
participants with “take-home” actionable strategies
for implementing sustainability in their corporations. To download
copies of
remarks and presentations, visit http://wri.igc.org/wrisummit/2003_agenda.html |
Hamlet Paoletti is a freelance writer based in Washington, DC. |
