Targets now vogue, for responsible enterprise
Posted by jembendell on February 14, 2008
I just launched the Lifeworth Annual Review at the League of Corporate Foundations in Manila. An interested and interesting group, who are beginning to explore the environmental dimension of their work, although basic issues of poverty and governance remain. Photo below.. looking a bit worse for wear having been up at 2am overseeing the upload of the website at http://www.lifeworth.com/2007review/default.htm
This year the reviews are also available in print (see http://stores.lulu.com/lifeworth). Story follows below.
“Continuous Improvement not Enough, Targets now in Vogue for Corporate Responsibility, says Lifeworth review.”
14th February, 2008, Lifeworth, Geneva, Switzerland.
A wave of corporate announcements of environmental targets swept the world during 2007, says a review of the year published by a corporate responsibility consultancy.
Awareness of climate change drove this agenda, with many companies announcing specific targets as part of their membership of initiatives like The Climate Group, the Carbon Disclosure Project, or the WWF Climate Savers initiative. Reckitt Benckister, Cisco and Proctor and Gamble are praised in the review for adopting broader targets.
“Continuous improvement is no longer enough, with time-bound targets now in vogue for corporate responsibility” says report co-author Jem Bendell, a Director of Lifeworth, which publishes the annual reviews. “Targets express an awareness of the scale and urgency of an issue and a willingness to engage it. Although investing in new management processes are key, making a commitment to a performance target helps add the substance,” he added.
This, the seventh annual review, reports on a survey of corporate responsibility professionals which suggests progress is occuring, but not fast enough to meet the international community’s goals on either climate change or world poverty. The poll of Lifeworth’s 4000 newsletter subscribers found they thought that by about 2028 approximately 57% of global economic activity would be environmentally sustainable. If that rate continues then overall performance would be 78% by 2050. This means the corporate responsibility community, as represented by Lifeworth’s subscribers, think current rates of progress would create a sustainable economy by around 2070. The Intergovernmental Panel on Climate Change (IPCC) has stated the world needs to see over 50% reductions by 2050, and the latest science suggests an 80% cut by then to remain under a critical threshold of 2 degrees warming. That would mean at least a 20% reduction in the next 10 years, and given growing emissions from industrialization in the global South, possibly even double that reduction in industrialized countries to offset it. The review argues that a slower rate of change appears to be futile, and so achieving a sustainable economy by 2070 will not actually be possible.
The world community has also made a commitment to eliminate world poverty by 2025. To do so would require economic activity to be socially responsible. Professionals estimate that on current trends only about 50% of economic activity will be socially responsible by then. It will only be about 75% by 2050.
“The message from the Lifeworth Annual Review is that although CSR efforts are delivering some progress, it may not deliver the sustainable global economy in time and we need to explore ways of enabling faster and deeper change,” explained Professor Michael Powell, Dean of Griffith Business School, which supports the publication. “A global step change in progress towards a sustainable world economy is required, and this will involve more targets from companies on their social and environmental performance, as well as more collaboration on how to shift entire sectors and market systems so they reward firms in meeting those targets” explained Dr. Bendell.
The implication is“we need to speed up the dissemination of new ideas, make them more readily available and easily accessible” says Professor David Grayson, of Cranfield School of Management. “The Lifeworth Annual Review is one practical way of doing this. I am delighted that the new Doughty Centre for Corporate Responsibility has helped make this happen this year.”
The concept of a ‘global step change’ is proposed by the review, to both describe the leap in progress required and the importance of promoting sustainable consumption. The Review suggests that if everyone lived like Europeans, ecological footprint calculations suggest we would need three planets to support us, and that if everyone lived like the average Asian we would also need more than one planet. Indian middle classes now have a higher per capita consumption of carbon than the average Briton. The review, titled “The Global Step Change,” concludes it would be physically impossible for all the world’s poor to achieve higher wellbeing in ways as resource-intensive as the new middle classes in Asia and elsewhere. “Humanity’s challenge is to find ways to improve human wellbeing within the limits of the Earth’s resources; to stop living as if we have another planet to go to” explains Jem Bendell. For this, Professor Grayson adds, “we need a new mindset for Corporate Sustainability to stimulate innovation and create radically new business models.”
Professor Powell, said “The review shows that more and more executives are realizing the need to gear up their efforts on sustainable business, and governments also increasingly recognize the need for hard targets. Beating climate change requires a step change in commitment and action. As the first Australian business school to adopt the United Nations Principles for Responsible Management Education, Griffith Business School is committed to educating business professionals to understand the critical nature of this challenge.”
The review warns that the adoption of specific targets by companies is only the beginning. “We should remember that targets themselves are not the mechanisms of change. It appears that many countries will miss their Kyoto targets, and the first Millennium Development Goals on primary school education have already been missed” explains Dr Bendell. “The solution may be for wider coalitions of groups to apply themselves to the factors that shape our economy. To explore ways of collaborating to shift whole markets.”
To coincide with the publication of the review, Lifeworth is launching an online directory of corporate targets for social and environmental performance: http://www.responsibleenterprise.com
Lifeworth’s predictions for 2008 and beyond:
* Many more companies will announce time-bound environmental performance targets
* Some companies will announce time-bound social performance targets
* Some Asian-based multinationals will announce targets
* More Private Financial Institutions and NGOs will encourage time-bound targets from companies
* More networks and partnerships between companies and their stakeholders will focus on how to shape the market drivers that reward meeting such targets, including public policy, financial systems and consumer awareness.
The review is launched by Jem Bendell, at the League of Corporate Foundations in Manila, Philippines, on February 14th 2008, and by the co-sponsor Professor David Grayson, in a series of lectures and speeches from February 13th to 15th in Brussels and in Copenhagen, at the Belgium Business and Society Conference and the Copenhagen Business School.
This seventh annual review from Lifeworth incorporates quarterly reviews from the Journal of Corporate Citizenship, published by Greenleaf, and is sponsored by Doughty Centre for Corporate Responsibility, Cranfield School of Management, UK and Griffith Business School, Australia. All the annual reviews are available for ordering in hardcopy from Lifeworth (http://stores.lulu.com/lifeworth), as well as being free to download or browse online at http://www.lifeworth.com
For press enquiries, contact lead author Jem Bendell at +44(0)2071936102, or jb at lifeworth.com