What challenges and strategies are top of mind for you in sustainable business?
That the climate and wider ecological crises are about to start biting; that the risks associated with those crises are systematically downplayed (despite the existence of regulation/guidance intended to build awareness); and that bold action to address them is typically punished either by the market or the electorate.
I’m afraid I’m with Professor Kevin Anderson in thinking that “there are now no non-radical futures.” We either change profoundly or we will be changed painfully. And business should be shouting from the rooftops for change, in the name of future business success.
What should we be doing differently today?
In the world in which I’m mainly active – TCFD/IFRS-inspired climate risk analysis – there first needs to be a consideration of tipping point risk. Alas, in the beyond-1.5°C world into which we are now heading, geophysical (and, I’d argue, societal) tipping points can no longer be ignored.
Companies also need to pivot to using climate risk analysis to gain strategic insight, rather than simply to meet a regulatory reporting obligation. Compliance-driven climate risk assessment often underplays risk and provides little strategic value.
And investors need to build the skills to critique, rather than just accept, disclosures that imply that everything is fine. I’ve seen companies dependent on reliable harvests state that *even under a 4°C scenario* there is no significant risk to grain yield; and I’ve seen banks report that their continued oil and gas investments not only pose no stranded asset risk, but are aligned with the Paris Agreement! Such findings should raise immediate flags across the investor community.
IF YOU COULD RESET SUSTAINABLE BUSINESS, WHAT WOULD YOU EMPHASIZE?
I’d bring more focus onto the *strategic* implications of sustainability. Far too much activity is now driven by the need to meet a reporting obligation/expectation, rather than to gain strategic insight, or to build a resilient business.
To butcher the idiom of not seeing the wood for the trees, we’ve encouraged – and in some cases demanded – that business precisely measure and disclose their leaf data (never mind their tree data) whilst the wood is starting to burn.
We need to turn business into effective agents of wider system change, such that the energy, transportation, food and economic systems that they rely on are transformed urgently and radically. The main reasons governments give for lack of action (or for slow, incremental action) on climate is that greater ambition will be bad for the economy. We need that to be challenged by businesses themselves.
WHAT ARE YOU MOST PROUD OF?
as we approach 1.5°C of warming, with little sign of the radical change required to keep us anywhere close to that level, I don’t think there’s much for the climate community, myself included, to be proud of. I remember when 1.5°C was – rightly – framed as the red line beyond which humanity should not pass, and we’ve clearly failed in our most fundamental task…
I think I’ve made a small contribution over the years in pushing the envelope on what corporate climate leadership could and should involve.
I do, however, think that fundamental societal shifts happen in mysterious ways, so perhaps our collective efforts to raise awareness and promote change has laid the groundwork for something substantive in the months to come?