January 5, 2015
In 2015, for the first time since the financial crisis of 2008, there is natural momentum for significant progress on sustainability. Our task is to build on it.
The reasons this is happening now come both from inside and outside the world of sustainability.
- The 2015 calendar includes signal events on climate and sustainable development: The new Sustainable Development Goals (SDGs) will be agreed on in September, and the post-Kyoto climate world will be shaped at the COP21 talks in Paris in December. These frameworks are crucially important, to be sure. Paris will catalyze greater clarity, and hopefully greater ambition, on the part of governments, which will prompt more ambition and innovation from business. The push from business began in 2014, in part with the formation of the We Mean Business coalition, a group BSR cofounded with others to engage business in pushing for public policies that lead to low-carbon prosperity. The emergence of the SDGs will provide a roadmap for raising living standards and human dignity in a world that is facing both poverty and widespread income stagnation. Together with the UN Guiding Principles on Business and Human Rights, an agreement in Paris and the SDGs will deliver a “holy trinity” of guideposts for business on the path to sustained, responsible markets.
- Politics are starting to swing back to sustainability: In Washington, with new initiatives coming from the White House, there are signs that climate approaches that reject science won’t play well in the 2016 elections. Internationally, the U.S.-China agreement, and promising words from other developing economies like the Philippines and Malaysia, suggest the possibility of genuine momentum in the run-up to Paris. All this, combined with an approach that relies on a network of commitments, rather than a single, grand treaty, suggests that Paris could surprise—in a good way.
- We survived the financial crisis: Why are political winds flowing in a more positive direction? Surely, part of the reason is that we are getting further from the economic free fall of 2008-09. And while a widely shared recovery is not yet in full force, the world is no longer in the throes of crisis. Increased economic stability (even if at relatively weak levels) allows policymakers and business leaders to take more forward-looking views, and this increases the likelihood of progress on climate change and inclusive economic growth, rather than short-term profit maximization.
- Renewable energy has reached a tipping point: 2014 brought growing evidence that renewables are ready to assume a place at the adults’ table. Through the first seven months of 2014, 53.8 percent of new electrical power capacity created in the United States came from renewable sources. And utilities are beginning to move, with NRG committing to low-carbon power, and E.ON in Germany spinning off its coal business. This comes as more companies are calling for a price on carbon, and as new transportation fuel mileage standards are arriving in the United States, and new carbon markets are emerging from China to California.
- A looming employment crisis is beginning to get more attention: Amid this optimism, however, there is reason for caution. Today, the economy’s winners and losers are becoming more distinct. For those who have the skills and access to the digital economy, opportunities are endless. But for those in manufacturing or service jobs, opportunities are declining. What’s more, the hollowing out of employment is likely to become even more significant, as the full impact of robotics, artificial intelligence, and mechanization replaces more jobs in this “second machine age.”
Most of these signs are positive, but they don’t guarantee success. We must work to ensure that markets reward genuine, long-term prosperity, and create systemic solutions to systemic problems. Dozens of businesses made powerful new commitments in 2014, and the conditions are right for the year ahead to extend that progress. Let us commit to writing a new history in 2015 that advances our shared goal of a just and sustainable world.
Let’s talk about how BSR can help you to transform your business and achieve your sustainability goals.