Climate change is real, it exhibits the hand of man, and it is the cause of global devastation. Despite the obvious need for immediate action, the human race is losing the race against time. Here’s a different approach for us to become resilient, kickstart growth, and accelerate the pace of progress toward sustainable development.
Last week Nasa scientist James Hansen linked climate change to extreme weather. His findings are topical, considering the ongoing widespread US drought, massive power outage in India, and historic flooding in China. Whether you believe the science behind climate change or not, these dreadful events rise above the sceptic’s eye.
Despite climate change’s continuing path of devastation, the world is still struggling to mount an effective response. Not that the global effort is not lacking. Rio+20 was the latest in a recurring string of international meetings to combat climate change and promote sustainable development. Prominent companies are investing significant amounts to achieve their greenhouse gas emission reduction commitments. And many individual citizens are acting voluntarily to reduce their environmental footprints.
But there are numerous, well-known roadblocks to an effective response. Let’s start with the word “voluntarily”. Action to mitigate the hand of man in climate change has for the most part been voluntary. Yes, the European Union has put its emissions trading scheme in place. And yes, Australia has set up its own carbon trading market. But without a binding global policy on greenhouse gas (GHG) emissions, global action remains voluntary. As we all know, there are timescale limits to voluntary actions.
The global effort to achieve a binding policy that transforms efforts from voluntary to “in compliance” is hamstrung by asymmetric competitive disadvantage. Outside of huge, near-selfless gesture, why would developed countries willingly limit their companies’ GHG emissions (therefore necessitating significant investment and potentially disruptive change) while developing countries would not be under similar conditions?
What makes climate change such a frustrating challenge is not only its scale but also its myriad stresses and risks. The challenge effects everyone, albeit unequally. Those living in particularly sensitive environments are at greater risk of suffering from climate change’s effects. And that’s before we discuss financial and technological resources. Climate change is a collection of stresses and risks. Stresses, such as the melting of the polar ice cap, and risks, such as the subsequent potential flooding of urban centres residing on shorelines, have been thoroughly dissected elsewhere. Suffice to say there is no single climate change solution.
Cross-sector collaboration provides the path to our best chance to navigate out of our collective mess. To see why and how, consider the Consumer Goods Forum. The forum brings together over 400 retailers, manufacturers, and NGOs from 70 countries. The member companies have combined sales of $3.1 trillion and employ nearly 10 million people. Eighteen months ago the forum’s members collectively set a binding agreement to help achieve net zero deforestation by 2020 by employing the power of their supply chains. Deforestation is meaningful to the forum’s companies because they rely on forestry for everything from palm oil, to soy, beef, paper and board materials for their products.
This agreement, and subsequent action, is noteworthy because deforestation accounts for nearly 17% of annual greenhouse gas emissions. Indeed the agreement possesses so much kinetic energy that in June 2012 the US government agreed to join the forum’s effort to tackle deforestation.
Cross-sector collaborations are most effective when targeting issues of collective enlightened self-interest. Water to a beverage company. Food to a food company. Energy to an energy services company. All three of these are clearly sustainable development issues. They have become, by company choice, the foundations of enterprise strategies.
To be clear, climate change itself falls within everyone’s sphere of interest. But where do we truly begin? How does a participant in a sector, or an entire sector for that matter, move the needle on climate change? And how can we avoid disappointment if we expect every participant in our global economy to act voluntarily in our collective best interests?
As the Consumer Goods Forum shows, there is appetite among the private, public, and civil sectors to collaborate on meaningful issues. Indeed initial conclusions from my study of ongoing cross-sector collaborative efforts reveals clues that could help answer to the challenges we face:
Change the object of our global pursuit from sustainability to resilience
Private, public, and social sectors must participate collaboratively if a set of solutions is to be found and put in place. Above all else, inaction within each sector is a prescription for obsolescence across all sectors.
“Sustainability” is perceived to be a loaded term, more often associated with stewardship than prosperous development. Our collective reliance on achieving a state of sustainability is leading to inaction, endless debate, and disagreement. Once and for all, let’s move beyond sustainability as synonymous with altruism, with “do goodedness”, and with liberal agendas. Instead let’s view action, and not merely debate, as synonymous with raising our collective resilience today while inoculating our global environment against the hand of man over time.
Work with organisations across sectors to solve common vexing issues
The key is to collaboratively focus on solutions to smaller, though no less significant, sustainable development issues:
• Without water, beverage, food, and energy companies perish quickly
• Without water, we perish quickly too
• Without energy, our lives are irrevocably disrupted. The same holds true for all companies
• Without food, we perish, though slightly less quickly than without water. Farmers and food companies in particular perish quickly without food
Water, energy, food – these three issues are the essential holy trinity of environmental sustainability. They are maddeningly intertwined and their effect reaches everyone – private, public, and social sectors alike. Because everyone is affected by each of these issues, and because they are so intertwined, everyone needs to be at the table. No one entity, no matter how large, can save us from ourselves.
Adopt an ‘action is our policy’ approach
The private and social sectors must stop waiting for government regulation in order to act. This is not earth shattering. But to this point the sustainable development action has been less than unanimous. Certain companies within the private sector are beginning to realise that they no longer control their own destiny. Now they can only influence their own destiny. Because, above all else, every company relies on natural resources and willing human labour for products and services. Without either, what do you have?
Collective action on environmental and social issues can kickstart growth. Solutions to the challenges discussed above will rely upon all else enlightened self-interests, innovation, and inclusivity. History has shown how innovation, when properly funded and scaled, lead to growth. Inclusivity in turn increases the likelihood of adoption of innovative solutions to frustrating problems. But it’s enlightened self-interest that will enable the scale of innovation and extend our reach to include as many constituents as possible.
As the Consumer Goods Forum example suggests, multinational companies can successfully lead cross-sector efforts to address vexing climate change problems. Their interests cross the borders of developed and developing countries alike, so their actions, when brought to life throughout their global operations, are not beholden to the asymmetric competitive disadvantage problem. Indeed companies including Coca-Cola, Unilever, and GE are actively embracing open innovation to find, fund, and scale ideas that build the foundation to solutions in the water, food, and energy fields. Coca-Cola is working with Dean Kaman, the Segway inventor, to refine and scale a device that can turn the dirtiest of water into the cleanest drinking water. Unilever is working with NGOs and other organisations to collect and bring best thinking and practices to 500,000 smallholder farmers worldwide. And GE’s Ecomagination challenge is both gathering ideas for new energy system technologies, but also using the company’s global footprint to refine, scale, and accelerate entrepreneurs’ ideas into significant revenue streams for all involved.
For those sceptics of the private sector, remember this: these companies understand that without water, food, and/or energy, they too will cease to exist.
We’re all in the same boat. It’s time to accept this and get on with escaping our mess by rowing in the same direction. Resilience, growth, and sustainable development remain within our reach. We just need to work together to grab these brass rings.
Article originally posted on the Guardian
Eric Lowitt is the author of “The Future of Value” and a forthcoming book, “The Collaboration Economy”. He can be reached via his website at www.ericlowitt.com