Sustainability on the Business Agenda How did it get there?

152.704Adam G. Jones 20 July 2010

Proof it IS on the agendaCurrently

Currently

93% of CEOs see sustainability as important to their companies’ future success (Accenture)

Currently

93% of CEOs see sustainability as important to their companies’ future success (Accenture)

81% of CEOs stated that sustainability issues are now “fully embedded” in their companies’ strategy and operations. (ibid.)

Currently

93% of CEOs see sustainability as important to their companies’ future success (Accenture)

81% of CEOs stated that sustainability issues are now “fully embedded” in their companies’ strategy and operations. (ibid.)

CSR and SD in core curriculum for MBA courses

Why wasn’t sustainability on the agenda before?

Why not before? (old ec. & Friedman’s profits within law,

govs. decide on laws, ‘business as usual’ leave

concerns at home)

Economics used to see business as a black box

Opp. Forces - gov&biz - false dichotomy - wait and see

OpposingForces

Milestones

Milestones

Milestones

Political Milestones

• ‘Limits to Growth’ published, 1972• Montreal Protocol, 1987, regulates CFC use• Bruntland Report, 1987• Kyoto Protocol, 1997

- many large companies change stance• ‘Anti-globalisation’ demos, 1999 and ‘01• CSR and SD on World Ec. Forum agenda, 2000• Stern Report, 2006

Business milestonesThe good

(sustainability can be profitable)

Body Shop, Ben&Jerry’s, GE Ecomagination, WalMart, Starbucks, Toyota

The bad(increasing scrutiny and pressure from the public, governments and

investors)

Bhopal, Exxon Valdez, mad cow disease, Nike sweatshops, GM foods, Enron, financial crisis,

Deepwater Horizon

Waves of Societal Pressure(John Elkington, SustainAbility)

“Climate change is like the Internet: it arrives one day and gets bigger every year, it never goes away and you have to learn to make money from it.’ (Paul Dickinson, CEO of Carbon Disclosure

Project)

Rising awareness (from tech and comms and travel)

Whether it’s waste, deforestation (visit Te Papa), air pollution, or even sweatshops in Philppiness or factory conditions in China

When it affects you directly (or see direct links), you act.

harder and harder to ignore

Auckland - costs to workers (and families), quality of life

100% pure Auckland?

Opp. Forces - gov&biz - false dichotomy - wait and see

OpposingForces

“Business is removing its veto.” (Peter Goldmark, former CEO of International Herald Tribune)

There is no universal agreement on why it’s necessary for business

3 types of manager responses:

• Being seen as irresponsible ‘won’t do’

• Doing well by doing good - competitive advantage• Social visionaries - people want sustainability

(Burke, 2005, Managing a Company in an Activist World)

L/T success - false choice - no universal

agreement on why it’s necessary

Not such a gamblewhen everyone’s doing it

This is not a bad thing / There are benefits to this

Quality of Life / Decoupling / Copenhagen - cleantech

Rush hour in Copenhagen.

40% cycle to work

“It would be silly for a company not to [be serious about sustainability] right now. When you look at what’s coming, there’s more people who want more cement, more microwaves, more fresh food - we know that our resources are going to get tighter and tighter. Businesses that don’t respond to this are going to find themselves extinct.”

(Adam Werbach, global CEO of Saatchi & Saatchi)

“Pursuing a mission of sustainable development can make our firms more competitive, more resilient to shocks, nimbler in a fast-changing world and more likely to attract and hold customers and the best employees. It can make them more at ease with regulators, banks, insurers and financial markets. Sustainable development policies will be profitable, but our rationale is not based solely on financial returns. ... In the long term, companies that do not reflect these people's best vision and values in their actions will wither in the marketplace.”

(World Business Council for Sustainable Development 2007)

Sustainability on the Business Agenda

152.704Adam G. Jones 20 July 2010

• It was kept off the agenda until recently by faulty economic models and business ‘veto’

• It has filtered onto the agenda primarily via scientists, NGOs and think tanks, political and business events, and business education

• Awareness is rising, so is pressure to act• This is not a bad thing