The header photo is the steelworks at IJmuiden in the Netherlands, on its way to producing carbon-neutral steel. In 26 years from now. Yet today the image is one of voluminous gases turning the sky dark, with wind turbines dotted around it… Past and future in one shot.
There is more if you look carefully. Kite surfers are enjoying the wind and the waves. A perfect illustration of where we are on the sustainability journey: a hard-to-abate sector making more stuff; the promise of renewable energy, and people getting on with their lives, enjoying nature despite the backdrop. Everyone can see their own worldview in the photo.
And it’s a vivid illustration of the disconnect in the corporate sustainability world these days. Leave aside the current rowing back on sustainability by an ever-growing number of companies. The issues haven’t gone away. The pendulum will swing back. But elsewhere, keeping on keeping on seems to be the order of the day. This is illustrated by the latest set of corporate reports that give the impression of continual progress. This mindset is bringing us to a very strange place.
Keeping on the same path is increasingly providing a jarring counterpoint to the discourse in the broader sustainability world. In academia, think tanks and on social media, sustainability as currently practiced, is coming under ever more scrutiny. What worked before is not working now (even more so as a chill wind blows through the sustainability world). There are several reasons – here are just a few that strike me as important.
The Moral Case
There was a time when ‘win-win’ solutions actually existed. Progress could be made reducing impact whilst saving money at the same time. Those days were over some time ago. Doing the right thing actually costs money. So the hunt is now on to find and provide ‘the business case’ for sustainability. Which is a dead end.
Sustainability always was about doing the right thing. In the absence of the ability to internalise externalities there is little point in even responding to a question around business case. “What’s the business case?” says more about the questioner – their ethics, morals, values, and their understanding of society and science.
The Dangers of Reductionist Approaches
There was also a time when working on sustainability meant working on a multitude of interconnected things, embracing that complexity. In the words of one inspirational boss: “We have decided to fight complexity with complexity. But this must be focussed complexity not hyperventilation. When you fight complexity with simplicity you lose”.
His words are coming back to haunt us. I have previously written about the difficulties of mobilising the world to tackle more than a few big issues, but perhaps that’s part of the problem. We got sucked into trying to compartmentalise problems. We need us to stand back, understand the root causes, perforate the silos and let ideas and energy flow across the system. If that sounds too philosophical, recall the climate tunnel vision graphic that circulates.
A few years back it really was great when CEOs started taking more interest in sustainability. But they brought with them a reductionist approach that works so well (too well) in creating value for shareholders and setting corporate remuneration packages. But sustainability is not about choosing a narrow set of issues to deliver impact upon. The current corporate desire to focus on (typically) just three themes, has undermined the broader approaches that necessarily need to address the messiness, connectedness and complexity of our business and economic systems.
And that links to targets. I’ve written before on the tyranny of targets – the focus on pledges rather than outcomes and the failure to focus on context, boundaries and thresholds. The debacle of SBTi has potentially fatally wounded the idea of ‘science based’ targets. I had pondered on its relevance 5 years ago. Sure, a company needs to set an ambition, but it also needs to recognise that its actions depend upon the context. Which is constantly changing or dependent upon geography. Its far more important to be accountable for actions over a period of the next 2-3 years. It is also illusionary to think that a 2030 target set in 2020 will still be relevant in 2025.
Reporting
And now there is increased scrutiny upon some other foundational elements of sustainability. Evidence is piling up that increasing the levels of transparency is not delivering the assumed progress. Meanwhile reporting is driving both greenwashing and greenhushing. But it is poised to play an important role in the future evolution of sustainability.
A move from voluntary reporting to regulatory compliance is already creating change. It is driving a levelling up across industry as laggards catch up. It is also redefining reporting as a compliance issue defined by a set of rules. There are already indications that reporting will migrate to accounting or legal functions.
The downside of this is that the emphasis on sustainability as a compliance issue calls into question (for some) the need to keep moving forward. Yet sustainability topics, best practice, and priorities do move forward, and have always moved faster than legislation. This provides a huge opportunity for sustainability professionals to redefine their role.
Just Transition
Liberated from the need to report, sustainability teams should go the whole way and also hand over responsibility for incremental improvements on existing value chains to their operations and procurement colleagues.
If planetary and societal boundaries, the Paris Agreement, the Montreal-Kunming Protocol, equity and equality are to mean anything, then sustainability needs to be central to the processes of innovation and strategy. Guided by the need to make real impact in the short to medium term.
Embedded in these roles, sustainability professionals then need to lead the discussion (and actions) to address the absurdity of assuming that companies and economies can carry on growing given those planetary and societal boundaries. Its time to work on business transformation, degrowth business models, just transition, and the role of the corporation in society. More in part II.