rethink sustainability
Quality conversation and a new concern: thoughts from Davos
This week I am in Davos attending the 2019 World Economic Forum. In the lead up to the event, it is always interesting to see the balance of topics on the programme and 2019 is no exception. Most pleasingly, I have never seen the issues of climate change and sustainability as high on the agenda as they are this year.
Unpacking sustainability
The event began with several fascinating panels discussing the potential threats and adverse effects of our current practices, with participants including former Vice President of the United States and climate activist Al Gore, Prime Minister of New Zealand Jacinda Ardern and naturalist David Attenborough, who was also interviewed by the Duke of Cambridge.
In particular, there was widespread agreement that the mechanisms, data, processes and effects of sustainability are still quite opaque to governments and investors alike. Clearly, there is more work to do to better understand these issues and communicate that knowledge more widely.
…there was widespread agreement that the mechanisms, data, processes and effects of sustainability are still quite opaque to governments and investors alike. Clearly, there is more work to do to better understand these issues and communicate that knowledge more widely.
Sustaining our focus
Gratifying as the conversation was, there was one thing I did find both concerning and—at first, at least—surprising. The results of the 2019 PwC Annual Global CEO Survey were revealed at Davos, which included a ranking of mid- to long-term business risks as perceived by CEOs. The threat of climate change is not ranked highly. And the risks that are seen as most urgent include issues such as over-regulation, policy uncertainty, skills availability and trade conflicts. In other words, these are issues around how easy it is to do business in a given market rather than anything particularly existential.
These results become less surprising when I consider them in the context of the nationalist and populist sentiments that are percolating throughout global politics. Against such a backdrop, the short-term de-prioritisation of environmental and sustainability issues amongst CEOs is arguably to be expected.
My concern is that these short-term decisions could yet have negative long-term effects. Sustainability is an issue that will surely outlast these more immediate tribulations. But if we are to succeed in addressing it, we must nevertheless maintain an immediate focus on consistent investment and business model adaptation.
Sustainability is an issue that will surely outlast these more immediate tribulations. But if we are to succeed in addressing it, we must nevertheless maintain an immediate focus on consistent investment and business model adaptation.
A rational self-interest
The irony is that if CEOs fail to act on sustainability on their own terms, politicians and regulators may compel them to by imposing precisely the kind of artificial constraint they are most worried about. Even if such limitations are your primary concern, then, focusing on them at the expense of other issues could be self-defeating.
The critical insight here is that a focus on sustainability is not an alternative to a focus on the success of one’s business. It is integral to it. In fairness, this integrity is arguably non-obvious, even counter-intuitive. I opened this update by saying that more work needs to be done in understanding and communicating the workings of sustainability. If we want the link between sustainability and business success to become more widely accepted, we must focus on this project with renewed urgency.
Wichtige Hinweise.
Die vorliegende Marketingmitteilung wurde von der Bank Lombard Odier & Co AG oder einer Geschäftseinheit der Gruppe (nachstehend “Lombard Odier”) herausgegeben. Sie ist weder für die Abgabe, Veröffentlichung oder Verwendung in Rechtsordnungen bestimmt, in denen eine solche Abgabe, Veröffentlichung oder Verwendung rechtswidrig wäre, noch richtet sie sich an Personen oder Rechtsstrukturen, an die eine entsprechende Abgabe rechtswidrig wäre.
Entdecken Sie mehr.
teilen.