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2015 sustainable business and political trends – a few predictions

Over the years I’ve sometimes posted on the blog a ‘looking back, looking forward’ summary of the year around this time in the calendar. 
This year I’m focusing only on 2015 trends, below. 
A few experts in the field also contributed, many thanks for that, you know who you are. 
Willing and happy to update the below, depending on comments. 
General business related trends:
Climate change and policy will be high on the political and corporate agenda. But the Paris meeting will be called a failure by NGOs after patchwork reporting on national plans during 2015. However national and bilateral pockets of policy progress will continue to grow. The important work of this Commission may have a substantial impact, eventually. 
Coal, Arctic drilling and tar sands related energy companies will become increasingly persona non grata for NGOs, some large (ish) investors and the general public. Their hitherto aggressive lobbying and greenwashing will increase. Greenpeace will keep the pressure up, as much as they can. New research is suggesting gas fracking chemicals are not as ‘safe’ as claimed. Lawsuits may begin to follow in 2015 and beyond. Community protests against fracking will undoubtedly grow further.

Investors will remain behind the curve on supporting sustainable business and longer term capitalism, but are beginning to catch up, as we hear and see every year. This study provides some useful context and analysis. The ‘stranded assets’ debate is gaining in credibility, and investor groups are now grasping that social issues management is key to retaining valuable licence to operate in emerging markets, and elsewhere. 

Preventing deforestation will be the area of sustainability where we see most rapid progress. The New York deflation on Forests and domestic commitments such as Kadin in Indonesia will drive increased awareness and more corporate policy commitments. The devil in delivery detail, however, will become more stark for big companies making pledges. Cross company initiatives such as those driven by the likes of the Consumer Goods Forum will help further. But 2020 targets are likely to need acceleration. Two excellent articles explaining the latest situations are here, and here
Despite EU Commission policy setbacks, the momentum towards serious progress on the notion of a Circular Economy will be continued. Businesses already committed to action will make progress on strategy integration but struggle with the question of scale and system incentives. 
Business and human rights will keep rising up the management agenda as more companies try to embeds the Ruggie framework. But splinter/niche areas and issues – such as human trafficking and slavery footprints – may accelerate as political and reputation oriented demand for semi-verifiable progress grows. Follow and to stay up to date. A useful list of the top ten emerging issues can be found here
As commodity risk grows and volatility and consolidation increases we’ll see more focus on raising yields, incomes and working / livelihood conditions at the end of the supply chain as purchasing influence grows and Governments voice concern. Palm oil yields could be doubled to save biodiversity, Cocoa yields could be tripled, eventually, so R&D in the area will see further focus. 
Resource crisis solutions will continue to grow, from solar desalination tech to algae oil like offerings as alternatives to Palm oil. Companies such as Solazyme are worth watching.
Oceans will move more centre stage in the run up to Paris and NGO focus on pollution of the seas, by shipping, plastics and of course CO2 absorption. 
Digital governance will be higher on the agenda, in different ways. As tech driven innovations such as Uber shake established markets there will be further blowback. And the positions and actions of tech firms related to privacy and intellectual property will continue to be challenged. 
Corporate tax payments – or perceived lack thereof – will continue to be big news. Smaller tax havens will feel increased pressure. 
A global lack of institutional capacity (and will) to enforce laws and level playing fields for business will continue to the 1000 pound Gorilla in the room for business. 2015 may be the year that lagging membership groups and industry bodies begin to think seriously about how to challenge that around the world. Countries such as Bangladesh, Cambodia, Nigeria and many others are in desperate need of unified business pressure to site alongside development agency work on improving business environments and governance for the better. 
Campaign groups such as Global Witness, Greenpeace, Rainforest Action Network, Forest People’s Programme and many others will continue to edge further towards this space, using business as a level for change, as ever.

Stakeholder engagement in general, will remain an area where companies make constant strategic and tactical mistakes during 2015. Strategic in that they fail to grasp its value beyond box ticking for reporting that no-one reads, and tactical, in terms of local operations where blow back from affected stakeholders, in person, or online, can cause serious operation, repetitional and financial setbacks. 

National trends:
Brazil will in the news in the run up to the Paris meeting as short term growth oriented changes to the forest code and mining code begin to bite. More on this in the comments section of this excellent general piece on deforestation.
India’s desire to compete on industrial exports and domestic supply competitiveness will continue to be controversial – and risky for corporate supply chains – given Modi’s changes to environmental governance (self policing over bureaucratic compliance)
The European Commission and Parliament will likely clash further over Juncker’s plans for growth clashing with Parliamentarians concerns over business impacts. (Circular Economy policy a prime example). It’s also set to be a critical year for the EU to set a coherent agenda for tackling youth unemployment. This is supposed to be top of Juncker’s agenda, but will that result in anything concrete / optimistic?
More broadly, but still relevant for business, is the question of whether the drift/shift towards regionalisation and devolution of centralised power will continue or prove to be a blip (Scotland, Catalunya)? In parallel, will the parties currently voicing the disillusionment of a certain tranche of the masses gain more ground or fall back (UKIP, Front National, Alternative fur Deutschland, etc)? All this will have a significant impact on business, not just for tax planning but also for the movement of talent. Companies may find, as with the Scotland referendum, that they have to take a political stance. 
China seems set to content its path of cracking down on foreign companies accused of breaking the rules. 2015 may be the year when their government takes more substantive action on the demand and trading of endangered species. Meanwhile the corruption crackdown looks likely to claim ever bigger scalps in politics and business. Environmental awareness seems set to grow as does the political importance of crackdowns on polluting industries that may cause social unrest. Brands will continue and expand their work on joining up social and environmental policy to drive improvements in the supply chain, as across Asia. Follow and for regular updates on the landscape. Newly-announced plans to regulate foreign-funded NGOs may change things, although it’s not clear yet how much.

Careless companies rushing to newly opening markets such as Myanmar or across Africa and rest of emerging Asia, will find themselves burned as stakeholder and campaigner access to communications technology and information generally, takes them by surprise.

Indonesia will have a bumpy time as their new president finds bold policy initiatives bogged down with old political, institutional and economic barriers. Bold initiatives such as merging the forestry and environment ministries may spur success, or backfire badly. Singapore will keep the pressure up when it comes to haze. The ever-excellent will cover it all, in detail. So will
Australia will become the world’s best known political climate villain, replacing the USA. 
In the USA, Obama will attempt to use his penultimate year in office to drive domestic environmental changes, improve the social safety net and push for big business to take more responsibility for social and environmental impacts. Whether current and forthcoming domestic regulations and foreign climate deals, such as with China, can be made to stick in future, will remain to be seen. 2016 may see a moderate Republican run against a moderate Democrat. That may be good for climate policy and domestic incentives. Time and politics will tell. 
Africa as a continent may see some integration moves around the 2012 Gaborone Sustainability Declaration and perhaps more focus on broader integration of renewables into traditional energy systems. Ethiopia may look to cement its position as a growing hub for responsible business in East Africa. Ghana will seek to re-establish economic credibility alongside a national CSR framework and growing calls for more ‘local content development’. Nigeria, the elephant of West Africa, will continue to struggle in both North and South politically, and generally with governance challenges, yet will remain a key investment destination due to its growth and size. 
In South Africa the situation post the tragic 2012 Marikana incident, where 34 striking miners died will be very delicate. A forthcoming report is likely to drive demands for further police accountability and provide fodder for protests from both Unions and human rights NGOs during 2015. Clearly, as ever, the extractive sector, and foreign companies in particular, will be under scrutiny. 
What might the potential collapse of Russian economy mean for EU business, energy policy, etc?  Unlikely to happen, but the CEO of Renault has been amongst the first to talk publicly about how much their bottom line will be hit (and potentially others in low margin, mass volume industries) if it all goes to pot economically in Russia. It all of course, seems to depend on the oil price, which may have hit a floor at the end of 2014. With regard to environmental issues, this set of interviews provides excellent context.

For anyone looking to be cheered up concerning 2014, this post from Bill Gates will provide some optimism.

Finally, Innovation Forum is trying to make our own contribution to more sustainable capitalism, with the following events (many more to come) bringing together the key players to debate genuine progress in various areas, as below. Focused and free briefings such as this one on these topics will follow shortly.

Sustainable and ethical cotton sourcing, 16th-17th March, 2015, London, UK
How to get it right, and make it pay for your business
Email: for more information on attending.

Business and human rights – How to get beyond policy, manage risk and build relationships
Two days of analysis, debate, discussion and networking, April 7th – 8th 2015
Email: for more information on attending.

How business can tackle deforestation
Understand deforestation risk, benchmark your policies and collaborate effectively with NGOs
14th-15th April, 2015, Washington DC
Email: for more information on attending.

1 Comment

  1. Some very interesting trends cited for 2015. I am wondering of the price of oil will continue to go down or start to go back up again next year. Definitely something to watch.