Saturday, 16 June 2012

Rio+20: Corporates and 'The Future We Want'

It is day two of the Corporate Sustainability Forum, ahead of next week's Rio+20 UN Conference on Sustainable Development.

The conference clearly will not have the seminal effect of the 1992 event; in particular, governments are currently pre-occupied with near-term economic growth -- and far less so with how green or gregarious it happens to be. There is a strong sense that the corporate forum, rather than the inter-governmental process, is where momentum and innovation on sustainability in development is to be found.

My last post noted that the current era of governmental austerity would accelerate change in the relative roles of the public and private sectors in providing public goods and advancing social development. In the formal Rio+20 policy outcome, governments will place far heavier emphasis on the role of the private sector not just in respecting sustainability concerns but in delivering the technologies, financing and drive required to build 'The Future We Want'. Certainly, the level and profile of business representation and involvement in such summits is far greater these days; the talk is all of public-private partnerships -- partly reflecting fiscal realities on the public sector's part.

For at least the largest global firms, the risks of insufficient action in building peaceful, prosperous, less-polluted societies (and the opportunities provided by demand for greener, friendlier products and services) provide such an incentive that they are unlikely to wait around for policymakers to lead the way. We can expect -- and should largely embrace -- greater corporate attention to issues on the Rio+20 agenda, even if collective action constraints remain.

However, throughout all the current excitement about what the private sector can bring to scaling-up urgent developmental needs, we risk forgetting that it is governments who bear the main responsibility to protect and promote social goals; despite sometimes being exposed to consumer pressure, companies are not accountable in the same ways. For their part, major corporates' commitments are to be welcomed, but there is a longer-term risk that explicit adoption by the private sector of the social development agenda potentially exposes business to socio-political forces and expectations that it is generally ill-equipped to manage. If you sell and preach the good society, to some extent you also then own it. The private sector may consider itself damned if it does or doesn't assume a greater role in meeting issues on the Rio+20 agenda.

Amid all the pessimism among activists about the Rio conference, I do think one must be careful in criticising governments for having a short-term focus on avoiding recession (that is, criticising the effect this has on sustainability priorities). This is because serious economic meltdown is hardly a pro-social outcome, nor necessarily a pro-environmental one. Moreover, at least since 2011's (very different) 'Arab Spring' and 'Occupy Wall Street' phenomena, governments are generally more aware that the quality of growth matters as much to social and political stability as the quantity of growth. The risk of widespread or sustained loss of social cohesion or political stability certainly gets governments' attention. Along with strategic energy security imperatives and other incentives, this may help to keep sustainability issues and promoting the green, good economy relatively high on the policy agenda of a surprising variety of states, despite the current focus on growth of any kind.


- I touched on these themes in an earlier post questioning the assumption that it is governments that necessarily lead on addressing societal issues calling for responsible regulation: here

- Our firm has been working with the UN Global Compact in the lead-up to the corporate sustainability forum. For our CEO's co-authored op-ed piece in yesterday's International Herald Tribune, see here.

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