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New WEF report shows that sustainable business groups will need to rethink their roles

The World Economic Forum and Accenture have come out with a new report. You really must read it.

Entitled “More with Less: Scaling Sustainable Consumption and Resource Efficiency” the report is also ’embedded’ below for readers.

There have been quite a few ‘big picture’ reports on the challenges and opportunities of sustainability for business in the last six months. This is one of the best.

I found the report a succinct summary of vital business challenges and opportunities.

It’s undoubtedly one of the best reports out there in terms of scope, compelling stants and terseness (important!) of the ‘big picture’ message. My congratulations go to the researchers and writers behind it.

I plan on using it in my classes on corporate responsibility at Birkbeck.

My only criticism is that whilst the report is superb on the challenges, it remains, like most of its ilk, short on solutions.

The WEF in general is not nearly brave enough on governments, preferring to rely on exhortation over more direct analysis.

The World Economic Forum, in my view, needs to rethink its role and use member information and progress to really encourage governments to act on helping sustainable business grow at scale.

This can be done by cajoling, embarrassing and rewarding country leaders and laggards, publicly and publicly.

Most importantly, WEF and its members can help show the way forward for expanding the basic business/government sustainability partnerships so far in place.

WEF research should now begin to drive sector by sector and country by country analysis.

Their work should start to highlight detailed solutions with recognition of the impacts of these. (the trade off between sustainability progress and unintended consequences on the status quo)

Beyond that: The barriers to government becoming suitably involved, and how they can effectively do that, really need exploring.

The South Korean example used in the report is interesting, but lacked detail and any rigour.

The report points out that:

“Governments drive scaled change in large part by using regulatory tools (i.e. law, taxation and markets to dictate what should and should not be done) and creating long-term ambitious targets. The South Korean government, with its powerful culture of leadership and collective action in the national interest, is driving forward with the nation’s business community an integrated green economy, with every intention of taking global markets by storm. More broadly, countries as diverse as China and Switzerland have envisioned how their development interests are aligned to sustainable growth outcomes and have successfully mobilized diverse interests to this cause.”

This is fine, but this is where much greater detail and analysis is needed in the future. The big businesses who will read this report already understand the challenges. Now we need evidence of successful work with governments to drive systemic change. A lot more than just the above.

The WEF report goes on to say that:

“In the Republic of Korea, the Green New Deal is expected to create 960,000 jobs while the country’s policy of Extended Producer Responsibility (for products such as tyres and packaging such as paper and glass) is expected to have an economic benefit of US$ 1.6 billion”

This is a one source claim, a well known example of a government promise in the depths of 2009. It’s not clear how well this was followed up. This is where more analysis is needed.

Business should support the WEF in probing this area in much more detail. Large companies are increasingly not the problem in comparison with government needs to set frameworks for them to operate in. This is where the WEF, and others should focus. It makes no sense not to, if you’ll forgive the dual negative.

Another area for the WEF to improve on in such reports is inclusiveness. I’m not saying they should become completely multi-stakeholder, but many of the green civil society groups have some good ideas on how to fix things. Speaking with them makes sense, and adds credibility to the WEF’s work.

Despite the title, which is trendy and will attract CEO readers (a very good thing) the report is not really about consumption at all, not in the consumer sense anyhow.

It’s very weak on that, as almost all reports are. The report contradicts itself over reported greener consumer demand/versus what we all know about consumer buying trends not changing fast towards sustainability labelled products. That’s forgivable. We need to talk about it even though we know consumers cannot drive this agenda. It’s a tough balance for anyone.

The report actually focuses much more on issues around corporate resources demand and the scaling of increasingly sustainable products, which to me is the important part of the debate given the above.

Future reports on business sustainability, in my view, need to recognise much more overtly that ‘solving’ the consumer demands conundrum is a misnomer in many ways: It will be up to Governments and companies to set the frameworks (by regulation and incentive and choice editing / product design/makeup) and whilst consumers will need educating and a growing minority care, they will not drive the revolution needed.

That’s a scary prospect to put in front of CEOs. The worry is we will turn them off. But the numbers do not lie. We need to get used to talking about this idea.

It’s not as if NGOs are not going to suddenly convert more than the slow growing 10-20% who actually make what they think are greener choices.

Here are some suggested lessons for the future, perhaps also relevant for any business association focusing on sustainability:

A) WEF and others should take a specific look at sectors where opportunity clearly exists but is not being taken up. Detailed sectoral analysis would get a LOT of CEO attention from the laggards. This is how to get new companies interested. Write about their industry, and then make sure they see it.

B) Inclusiveness is key: WEF needs to show it understands the value of wider stakeholder engagement than just big business. That’s vital for credibility and communications, as above.

C) Most importantly, WEF needs to be much braver on criticising Governments. Part of the point of WEF going forward will eventually be to call out Governments and suggest policy solutions where individual companies feel too nervous to do so (I’m sure Siemens doesn’t want to upset German politicians directly, for example, understandably)

D) Implementation: The report is a little light on the real business case and results of changing practices in comparison to overall business as usual. Cherry picking examples of innovation and opportunity is fine, but a look at how these are being, or could be scaled compared with traditional products/services is very important given the importance of context.

In conclusion though, I don’t want to seem too critical. This is one of the best five reports I have seen in the last few years on business challenges and opportunities around sustainability.

I just hope the business organisations will recognise sooner, rather than later that they will need become much braver and more solutions-oriented on the governmental frameworks side: That’s the only path forward at scale.

Here’s the report again:

More with Less: Scaling Sustainable Consumption and Resource Efficiency

2 Comments

  1. Toby – really interesting review and I only saw it after writing mine here http://onestoneadvisors.com/fresh/?p=1396 or would have cited it at the time. I also think it is a good report, but as trust in business is so low (Edelman) how will corporates convince important stakeholders that business-driven scaling will reduce impacts?

    On your ideas for ways forward:
    A) Agree about focusing on sectors with opportunities to drive these ideas beyond the charismatic leaders, but it's important not to brush tougher sectors under the carpet
    B)Crucial point about inclusiveness – see my blog – after all, business is seen by many as the root of unsustainable consumption. This can only change if stakeholders are convinced of the turnaround
    C)Yes business groups should be brave about criticising governments – but they should also face their own contradictions, and it will take even more courage to do that.

  2. Randall Krantz

    Toby, Fair assessment all around. I'd agree with some of the key issues you highlight, many of which will define our work over the coming year.

    In particular the need to adjust demand as well as chase supply chains, this is something that is very frightening for companies, but nearly every CEO interviewed mentioned it. When it comes down to operationalising how to make more money with less stuff, the innovatin is not generally coming from the multinationals, but from the innovative startups which are actually looking to redefine what is the value that they want to deliver. Now we just need to get that to scale.

    As for the role of governments, we extended an open hand to engage, with four workshops in Brazil, South Africa, Indonesia and China, but the govt uptake was minimal. We also worked hard to get the business voice into the GSP, though their final product leaves much to be desired. It is difficult for the Forum to criticise governments, but it is true that there is a need.

    Lastly, on engagement with civil society, we did engage with more than a dozen organisations to get their input, including WBCSD, WWF, TSC, SCI, CSCP, WRP,RSPO, etc. would be glad to know who is missing so that they can be engaged!

    Best,
    Randall

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