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Blog | Friday July 1, 2022

President and CEO Aron Cramer Responds to West Virginia v. EPA

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BSR believes that today’s US Supreme Court hearing in West Virginia v. EPA is a deeply mistaken decision that wrongly undermines the US federal government’s ability to take decisive action to combat dangerous climate change.

As we continue to assess the specifics of the ruling, many things are clear. First and foremost, the science speaks in a way that is more authoritative than the Court, and it is clear that climate action is becoming more and more urgent by the day. Restricting the ability of the EPA, the main environmental regulator in the US, means that the United States will not be able to take steps necessary to shift to a clean energy economy.  Signs of further restrictions on other science-based steps to address environmental and other questions are also very troubling.  

The damage done by this decision emanates beyond the immediate impacts on the EPA’s regulatory authority. It will undermine American climate diplomacy, at a time when the world’s largest economies must band together to take action on a global basis. Reversal of climate action also creates a public health challenge, one that falls most heavily on women, people of color, and communities with fewer economic resources.  It also suggests that the Court, as it showed  in its recent decision to overrule and invalidate Roe v. Wade, and weaken states’ authority to enact gun safety legislation, is not only damaging to the rights of Americans, but also out of step with public opinion in ways that weaken its legitimacy.

Today’s decision reinforces the need for ambitious climate action on the part of business, states and cities, civil society, and all of us as citizens. We are pleased that so many companies from across the US supported an amicus brief supporting the EPA’s authority.  Even more, thousands of companies have committed to net zero climate strategies, and are investing in new business models, technologies, and transition plans to help lead the way to a clean energy future.

We are convinced that the future depends on this transition. While it is heartening to see action from state and local officials, investors, civil society, and businesses, it is extremely distressing that the Supreme Court has embraced a backwards looking ideological approach that will only create greater cost and economic uncertainty, worse public health outcomes, and even more political division. We will continue to work with our more than 300+ member companies and many partners to achieve a truly just and sustainable world.

Blog | Tuesday March 31, 2020

Meet the Moment. Build the Future.

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As the health and economic impacts of the coronavirus pandemic continue to spread, we at BSR are working hard to continue supporting our member companies around the world, along with our many other partners, as you navigate this extraordinary and unprecedented time and contribute to our collective well-being.

From speaking with many of you, we know how challenging it is to manage effectively during this difficult and uncertain period, which poses significant impacts on your businesses, employees, and supply chains. Many of us are also coping with the stress of health impacts on ourselves, our families, and our communities.

This remarkable moment calls on all of us to bring our very best. We are quite literally writing history through countless acts and decisions we make every day.

Our approach at BSR can be summed up in six words: Meet the Moment. Build the Future.

Here’s what we mean by this.

Meet the Moment

It is essential for all of us to adapt sustainability activities to address the profound short-term needs faced by companies, employees, and communities in these challenging times. From speaking with many of you over the past few weeks, we know that you are facing new, unprecedented questions. How do I ensure that we continue with our commitments when our business is in such difficulty, with budgets under intense pressure? What is the right thing to do to support our employees, and those who are employed in our supply chains? How is the economic crisis impacting traditionally marginalized groups, and how can we respond to that? Can we reorient manufacturing to deliver on health care needs? Should we publish our sustainability report at a time when doing so might appear tone deaf?

We have been proud to see so many of you take action to protect employment, help generate badly needed medical equipment, provide capital, and support essential public policy steps to address the health and economic impacts of this pandemic. We are here to help you think through how to respond, to build partnerships, and to amplify your efforts.

Build the Future

As challenging as the day-to-day is right now, this is also a time to think ahead to building a fundamentally different future. For business, this means more emphasis on resilient business strategies, something which we have been discussing with many of you, and is now much more than an abstract concept. Sustainability questions can and should be a core element of such strategies. We also see the rising importance of ensuring societal resilience. This is why business has a strong interest in remaking the social contract to meet 21st-century needs, ensuring economic vitality, stability, and security. We know also that the next challenge to resilience could come from environmental challenges that risk creating serious social disruption and economic loss. The future may not seem relevant right now, but if this episode teaches us anything, it is that change can come more quickly and powerfully than we might think.

BSR’s Efforts

We are here to help you both meet the moment and begin to think about how to build a different future. We know that the pandemic is having a profound impact on your business. We also know that sustainability can be one of the core elements of navigating this crisis while also bolstering your position once the crisis passes. To help you achieve these goals, we are re-orienting some of our activities to help you meet these extraordinary circumstances, while also staying focused on longer-term objectives that remain extremely important, and indeed, could be seen as even more important.

• Communications: We will be producing a series of blogs and webinars to help you understand and discuss the impacts of the pandemic on sustainable business, both overall, and on specific issues like human rights, women’s empowerment, and the impact on ESG investing. In addition, our industry teams are bringing member companies together to share challenges and best practices within their sectors.
• Collaboration: We have shifted many of our collaborative initiatives to virtual formats, and the initial signs are that these are delivering on group objectives well, in some cases with even more participation as virtual models take hold. We are also speaking with many of you on how we can generate new collaborations that meet the moment, whether staying focused on climate action despite turbulent times or designing more resilient supply chains that will be needed once the crisis subsides, and we welcome your inputs on other matters we can help you navigate with peers. We also remain mobilized to support you one-on-one via advisory work.
• 21st-Century Social Contracts: We are accelerating our work on 21st-century social contracts. We welcome your engagement on this crucial issue, and will have content coming in the next two weeks on how business can not only meet short-term needs, but also contribute to more resilient social contracts that enable economic vitality, as well as economic mobility and security in a fast-changing world.
• Emerging Issues/Scenarios: To help you stay focused on the future, we are launching the first in a series of emerging issues briefs in June. This will be delivered by our Sustainable Futures Lab and will be based in part on a virtual salon in late April.

This crisis will pass. Our world, our businesses, and our economies will not look the same in the post-pandemic environment. But our values and objectives will not only endure, they will provide the very basis for seeing us through the crisis. They will also serve as the foundation for structural changes that produce more resilience, more economic fairness, and an ongoing commitment to preserve natural resources.

And these values will guide us as we meet this moment and build the future—together.

Blog | Wednesday July 19, 2017

Inclusive Growth: How Business Leads

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Turn on the news on any given day and the lineup of stories is often the same: an economic report of flat wages and rising financial insecurity combined with tales of social unrest and political instability around the world. Beneath all these seemingly disconnected events lies one common thread—inclusive growth.

The Organization for Economic Cooperation and Development (OECD) defines inclusive growth as “economic growth that creates opportunity for all segments of the population and distributes the dividends of increased prosperity, both in monetary and non-monetary terms, fairly across society.” A lack of inclusive growth has been tied to everything from higher rates of cancer and crime to voting for populist leaders to joining terrorist groups.

Creating more inclusive forms of economic growth has long been seen as the responsibility of governments and civil society. Yet in the last few years, it is increasingly being taken up by the private sector as a central pillar of company sustainability platforms. According to the 2017 BSR/Globe Scan State of Sustainable Business report, which will be published later this month, the number of companies that say they consider inclusive growth a "high priority" for sustainability efforts has increased almost 10 percent since last year.

Companies are taking action on promoting inclusive growth through three main mechanisms: creating good jobs, expanding access to products, and engaging with society.

Creating Good Jobs

A 2016 survey by JUST Capital found that the U.S. public considers providing good jobs as the most critical sustainability issue facing companies today. Some companies are rising to this challenge. IKEA, for instance, made a commitment in 2014 to pay its U.S. retail workforce a living wage. Other areas where companies are beginning to think about good jobs include treating contingent workers more fairly, investing in training and career paths, creating predictable scheduling, increasing benefits coverage, and developing profit-sharing programs.  

Companies are also starting to develop ways to expand their diversity and inclusion efforts to include more groups who face challenges in employment. Member companies of the Global Impact Sourcing Coalition are focusing on ways to improve inclusion in their supply chains through encouraging their suppliers to offer job opportunities to neglected groups, such as long-term unemployed persons, informal sector workers, and “neurodiverse” workers. Some companies are exploring how to bridge geographic divides through “rural sourcing” programs, which hire people from high unemployment rural communities in the United States. There’s even a small group of companies focusing efforts on preventing violent extremism by offering economic opportunities to youth in communities that are targeted by terrorist recruiters.

Expanding Access to Products

Access to affordable and high-quality products in housing, basic infrastructure, healthcare, food, and financial services is a critical component to inclusive growth. Many companies now have access policies and programs for their products. One example is MasterCard’s Center for Inclusive Growth, which uses proprietary technology platforms and big-data capabilities to connect microentrepreneurs, refugees, and other excluded groups to affordable financial services products. The United Nations’ Business Call to Action has secured inclusive business commitments from more than 190 companies to expand access to critical goods and services to the poor in developing countries. Chobani’s founder and CEO Hamdi Ulukaya formed Tent Partnership for Refugees which has organized commitments from companies to improve critical product access to refugees. Doug Rauch, a former president of the grocery store Trader Joe’s, started the The Daily Table, which has organized more than 40 grocery chains and food brands to tackle the challenges of food deserts and malnutrition in U.S. inner cities.

Engaging with Society

Community and government engagement for inclusive growth has long been a focus in the extractives industry, where maintaining a ‘social license to operate’ has been a central focus. Yet the range of industries, geographies and policy issue areas in which business is engaging is expanding.

The last few years have seen a growing tide of "CEO Activism." Earlier this year more than 150 CEOs signed an amicus brief on the U.S. executive order on immigration. This trend could continue in the coming years as businesses weigh in on other critical inclusion policy issues such as U.S. universal access to health care. Other dialogues are also forming at the multilateral level such as the OECD’s Business Leaders for Inclusive Growth and at the “B20,” which is the business platform at the G20. These platforms can provide ways for business’ collective voice to promote fairer and more inclusive policy frameworks for global trade, immigration policy, digitalization and skills, and other global economic challenges.

Inclusive growth is one of the great challenges of our time. Yet through commitment, collaboration, and action, business is showing that it can move from being a central source of the problem to a central driver of the solution. 

Blog | Tuesday April 11, 2023

Call to Action for Businesses on the Medication Abortion Rulings

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Full access to Mifepristone (part of the two-drug regimen for medication abortion in America) remains legal after the US Supreme Court blocked new restrictions from taking effect. The Supreme Court’s order on Friday, April 21 was a decision about whether the lower court’s stay could remain in place—litigation on the merits of the case will continue in the Fifth Circuit Court of Appeals with oral arguments on May 17.

For background, on Friday, April 7, two federal judges issued opposing rulings in litigation regarding access to Mifepristone (Mife), a safe, effective prescription drug utilized in medication abortion and miscarriage care. Mife has been FDA approved for 23 years and is how more than half of patients in the US access abortion care. A federal judge in Texas ruled that the FDA's initial authorization of Mife was improper and sought to suspend the pill’s FDA approval. Less than an hour later, another federal judge in the state of Washington issued a ruling that directly conflicted with the Texas ruling, ordering the FDA to make no changes to the availability of mifepristone in the 18 states that filed that lawsuit. These two rulings set up a legal standoff that will need to be resolved by higher courts. The Fifth US Circuit Court of Appeals granted the Biden administration's request to put on hold part of the Texas judge's order blocking the FDA's approval of the pill.

The rulings have created confusion about whether the drug is still legal and accessible despite having been safely and effectively used by millions of people since it was approved in 2000. This has been a rapidly evolving situation over the last several weeks, but we now know that patients will continue to be able to access Mifepristone pending any further court rulings this summer.

Access to medication abortion is even more important since the Supreme Court overturned Roe v. Wade last summer. According to new research on Talent and Social Policies conducted by Morning Consult, on behalf of BSR: 

• By a 2:1 margin, workers want to live in a state where abortion is legal and accessible. 
• Nearly half of workers are concerned for themselves or their partner being criminally charged or going to prison for having an abortion in a state where it is illegal. 
• More than a third of workers are concerned about having enough money for themselves or their partner to travel out of state for an abortion. 

Restricting access to comprehensive reproductive care, including abortion, is a business and economic issue that employers are already navigating. A ban or further restrictions on medication abortion will result in workers needing to take more time off to find and access healthcare, increase travel and logistical burdens, raise healthcare costs and potentially additional medical follow-up, and increase trauma for employees seeking time-sensitive services and facing unexpected hurdles. In the number of states where abortion is legal, reproductive healthcare systems could potentially be overwhelmed by people traveling to them for care. 

These restrictions harm women ages 18 to 45 and have disproportionate impacts on lower-income people, people who live in rural counties, those with disabilities, and families navigating fertility treatments as well as higher-risk pregnancies. Companies need to support efforts to ensure that workers have access to essential healthcare. This is a matter of safety, privacy, and workforce well-being.   

Understand the Impact of This Case   

BSR is a signer of Don’t Ban Equality which provides the following background and recommendations. 

• This case will impact employers of all sizes, in every state, and its potential outcomes represent uncharted territory.  
• In addition to safe, effective, and widely used medication abortion care, the case would impact the safest, most effective form of early miscarriage care, and potentially fertility care. 
• Employers should evaluate and commit resources (time, travel, and expenses) to support their workforce and dependents to get care, which may increase as employees need to travel further for abortion and miscarriage care. 
• Employers should be aware that a nationwide ban on mifepristone would compound gender, economic, and racial inequities, and that providers are already stretched thin. 10 US States Would Be Hit Especially Hard by a Nationwide Ban on Medication Abortion | Guttmacher Institute and Where Restrictions on Abortion Pills Could Matter Most in the U.S. - The New York Times (nytimes.com) 

Recommendations for Business Action  

1. Be vocal now. Speak up about how this ruling could impact the workforce and the benefits you provide to your workers and their families. Eliminating access for this abortion and miscarriage management translates into more logistical burdens, more time away from work, and an additional threat to employee safety and well-being. Speak to the business press, including on background, so they can understand and amplify business concerns, what steps businesses are taking to protect workers/employees, and what challenges employers are facing. Businesses should communicate actions they are taking with their workforce—as employees will ask about how their employers’ existing commitments, programs and policies are affected.
2. Stand up in business associations. Business associations that your company belongs to can also stand up—they can sign amicus briefs, engage privately with officeholders, and provide safety in numbers. Hundreds of pharmaceutical and biotech companies as well as individual executives signed an open letter opposing the Texas judge’s ruling. The BIO industry association alongside companies and other executives in industry ultimately filed an amicus brief at the Fifth Circuit and the Supreme Court citing threats to pharmaceutical innovation and industry standards. The Pharmaceutical Research and Manufacturers of America (PhRMA) filed an amicus brief with the Supreme Court citing concerns about widespread industry disruption if a ban on Mifepristone went into effect.
3. Communicate with lawmakers. Talk with office holders that represent your operational locations about the need to codify access to reproductive care into law, including the federal Women's Health Protection Act, and any efforts for codification in supportive state environments. Reach out privately to lawmakers in states where new restrictions are advancing right now to oppose them, including North Carolina and Florida (also see the State policy bill tracker and What US Abortion Legislation Looks Like in 2023).
4. Understand business impacts on customers and affected stakeholders. Identify how your business’ actions, products, and services might impact those seeking reproductive healthcare, including data tracking and surveillance, financial services for health care providers, pharmaceutical sales policies and practices, etc. Shareholders are already demanding more from companies post-Roe.
5. Align corporate political giving heading into the 2024 election cycle. Employers that support diversity, equity, and inclusion need to consider the bottom-line and personal consequences of providing uncritical support to lawmakers that are advancing dangerous policies that are opposed by a majority of workers in the US. Companies can do self-assessments and use tools like the Erb Principles for Corporate Political Responsibility to help companies respond to new questions and pressures related to their political influences – from employees, investors, customers, and the public.

BSR’s Center for Business and Social Justice is tracking the developments of this case and continuing to help companies navigate this chaotic environment. Reach out to BSR’s Center for Business and Social Justice to learn more about resources, practices and ways companies can get involved.  

Originally appeared on LinkedIn. 

Blog | Tuesday April 11, 2017

Automation: How Business Can Lead a Sustainable Transition

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Automation will profoundly alter the future of work and society, as a great deal of recent research and projections on its impacts have shown. Some have predicted automation will lead to a gloomy future of permanent high unemployment, while others have touted many potential benefits around health, safety, and the environment. Yet, automation also poses a practical challenge for today’s business leaders, who must tackle how to take advantage of the productivity and innovation opportunities presented by automation technologies while also ensuring a smooth workforce transition. These leaders will have to help their current employees adapt to new technologies or retrain for new occupations, and they will also have to build a future talent pipeline that is educated, trained, and capable of meeting the needs of an automated workplace.

In a new BSR issue brief, “Automation: A Framework for a Sustainable Transition,” we explore some of the ways that companies are beginning to address automation, including engaging with civil society partners and governments. The brief explores four practices companies can adopt to facilitate a smooth transition.

1. Forecast and Communicate Planned Changes Early

The rollout of automation will affect different industries, occupations, and communities at different points in time. Early notice is critical, so that workers and governments have time to plan for the transition, reskill and train for new occupations, and minimize time spent in unemployment. The European Union’s CEDEFOP has started an early warning system that forecasts needed skills and workforce changes. By contributing their projected future needs to these systems, companies can help current workers and students plan for the skills that will be in demand in a specific geographic area.

2. Commit to Training and Support Education Partnerships

Companies can commit to partnerships with local educational systems, as well as open-source and online education, to prepare new generations of workers and upskill their incumbent workforce. Examples include partnerships with secondary schools and colleges to teach technical skills and coding or participation in formal workplace training programs through the Global Apprenticeship Network. Companies can also directly fund upskilling of their workforce through onsite training and use of micro-credential programs like Udacity.

3. Provide Support to Displaced Workers

Companies can play an important role in improving the outcomes of workers who will lose their jobs to automation by giving them early notice and extensive support to retrain and/or relocate to pursue new opportunities. Companies can partner with nonprofits and governments to include additional benefits in severance and outplacement packages, such as training grants to reskill for a new role in the company or for a new occupation, relocation assistance, or technical support and funding to start a new business.

4. Support Public Policies to Modernize the Social Safety Net

Automation represents the type of global challenge that can’t be solved through government policies or through individual companies’ CSR programs alone. It requires a coordinated and collaborative approach. Business leaders can play an influential role by using their collective voice to encourage governments to adopt policy frameworks that support workers in the transition to automation. U.S. policies currently being explored include wage insurance programs, which would help workers who lost income during the process of their career transition. Some countries, including France, are developing ITAs, or individual training accounts, which allow workers to accumulate tuition funds and paid leave so that they have time and funding to reskill during their careers. And business leaders are participating in dialogues around transformative policies, such as Bill Gates’ proposal for a “robot tax” to help governments make up shortfalls in payroll taxes. Other longer-term ideas are also in pilot tests in various countries, such as the universal basic income, championed by Tesla CEO Elon Musk, Y Combinator, and union leader Andy Stern, among others.  

Whether adopting and sharing the lessons of their individual company programs, forming industry-wide partnerships, or advancing public policy solutions, business leaders can play a critical role in the global effort to redefine the future of good jobs in the age of automation in the 21st century and build an economy that works for all. 

Blog | Thursday June 15, 2023

The US Supreme Court Ruling on Affirmative Action: A Business Response

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It is expected that the US Supreme Court may issue a landmark decision that ends the practice of affirmative action this month. The ruling would effectively ban US colleges and universities from considering race as a factor in admissions decisions which, as illustrated by existing state-level bans of the practice, can reshape the demographics and diversity of campuses for generations.

More broadly, as research has shown, the consequences of a national ban on affirmative action are likely to ripple throughout the US economy as decades of efforts to increase social and economic participation by historically excluded populations are upended and schools, businesses, communities, and governments become more racially, and even ideologically, homogeneous.

For business leaders that care about hiring and retaining diverse and exceptional talent, developing and delivering innovative products and services, and attracting a diversified consumer base, the end of affirmative action should be seen as more than another philosophical or policy debate in the so-called “culture wars.” Indeed, business leaders should understand and respond to the end of affirmative action for what it is: a significant and material risk to long-term corporate economic success.

As such, bold and committed action is needed in the months and years ahead to ensure that progress toward a more diverse, equitable, and inclusive economy is not lost, nor business value diminished. Even as we wait to see the final ruling, there are seven key actions businesses can take:

Underscore Your Company’s Long-Term Commitment to Diversity
 

• Reiterate your company’s commitment to building and maintaining a diverse workforce and organization. According to recent public opinion polling, 69 percent of adults agree that a company should respond to issues surrounding race, including supporting schools and communities teaching about the impacts of slavery and racism. Raise awareness of your company’s commitment to operationalizing DEI initiatives, developing products and service offerings that meet the needs of diverse communities, and supporting broader racial equity and social justice efforts.
• Commit to corporate accountability initiatives that focus on racial equity and DEI in the workplace. Business leaders need to be regularly exposed to and equipped with educational resources and practical tools and can seek out opportunities to participate in current and emerging civil society and philanthropically supported efforts. Among others, these might include:
   
  • Pilot new corporate standards tackling inequality from the Corporate Racial Equity Alliance, a partnership between PolicyLink, FSG, and JUST Capital. The standards will provide business leaders with clear goals to strive for, milestones along the path, and metrics to track in order to communicate progress in this work and earn greater trust. Piloting companies will receive individualized support from the Alliance and provide essential input to help shape the standards for the field.
  • Join the Expanding Equity network supported by the W.K. Kellogg Foundation, which offers resources, as well as learning and networking opportunities, for business leaders focused on advancing racial equity, diversity, and inclusion (REDI) strategies in their organizations. Several resources are available now, and a robust learning platform with courses on REDI strategy development and related topics will roll out later this year. 
• Assess your company’s hiring data to identify barriers to diverse talent acquisition and surface factors that may support the long-term hiring of diverse workers. This may include collaboration between human resources, communications, and legal teams to review job listings and ensure barriers and biases are eliminated. Companies may also evaluate their onboarding, performance review, and employee benefits policies and practices to understand where there may be opportunities to increase the retention of diverse workers.
   

Demystify Affirmative Action Impacts among Company Stakeholders and Bolster Good-Faith, Fact-Based Public, Policy, and Legal Discourse
 

• Support campaigns by industry groups and peers that inform how colleges and universities utilize affirmative action to enroll a diverse student body and highlight the direct and indirect impacts of the practice on your business. In the coming months, the broader narrative in the public around affirmative action is likely to be fueled by polarizing inaccuracies, misperceptions, and hyperbole. Business leaders should look to leverage their communications, policy, and other media infrastructure to elevate the discussion of affirmative action so that it is based on facts and the real, tangible ways in which the court’s ruling impacts your company and the broader economy. 
• Establish guidelines for your state- and federal-based political giving that minimizes donating to candidates who spread misinformation about affirmative action practices and impacts. As we head into what is likely to be a divisive and controversial election cycle, corporations can play a direct role in minimizing the extent to which bad-faith actors negatively influence public and policy discourse around affirmative action practice and impacts and the long-term benefits of a diverse, inclusive, and equitable economy, more broadly. Whether individually or in alignment with industry peers and other valued stakeholders, business leaders should consider how their political giving can be tailored toward political candidates and leadership that champion good-faith ideas based on fact and the economy’s long-term interest in mind.  
• Leverage philanthropic, community engagement, and corporate responsibility resources to foster the development of student admission approaches and strategies that support and safeguard diverse enrollment in higher education and at trade schools. Here, companies can collaborate with school leadership and educational associations to conduct regular engagement sessions or support research that informs admission officials’ understanding of potential admissions approaches and practices that can further support diverse talent development pipelines.
• Prepare for ongoing state- and federal-level engagement. Companies can ensure that their teams are equipped to monitor and support with amicus briefs to safeguard human resources initiatives, DEI programs, and other corporate diversity efforts at lower-level federal and state courts before they bubble up to the higher courts. Furthermore, given state-level policy already targeting DEI programs with an intent to send a chilling message, companies should expect copycat efforts in future legislative sessions.  

As we saw with the fall of Roe v. Wade last year, the end of affirmative action is likely to encourage partisans and extremists to seek out a myriad of legal, policy, and media levers to create unrest across jurisdictions. The business community cannot afford to watch from the sidelines or be caught off-guard because of a lack of action or infrastructure to reinforce and protect long-term business strategy.

BSR’s Center for Business and Social Justice works with a network of civil society partners and experts in reproductive health to provide tangible guidance to business. All BSR members can contact the Center for specific inquiries.

Blog | Wednesday October 18, 2017

Why Business Supported the Clean Power Plan: It Made Economic Sense

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The last few weeks in the United States have seen an unprecedented number of consecutive natural disasters—including both hurricanes and wildfires—exacerbated by our changing climate. In fact, a September poll shows that a majority of Americans assess that it is likely that climate change indeed worsened the impact of these events.

In this context of heightened public awareness and increased devastation due to climate change, EPA Administrator Scott Pruitt signed a rule last week that will begin to roll back the Clean Power Plan (CPP). The Administrator made an economic argument in support of the repeal, claiming that regulations “ought to work with folks all over the country and say, 'how do we achieve better incomes by working with industry, not against industry'.”

However, all evidence points to the fact that climate action is good for the economy. That’s why many companies in the private sector have supported the CPP, arguing that it is good for business.

The state of California, which has the sixth-largest economy in the world, is in many ways a poster child for this argument: In 2015, California simultaneously reduced its greenhouse gas emissions and achieved its strongest economic growth since 2005. The state has some of the most ambitious climate targets in the United States, and in 2016, it created more jobs than any other state for the third year in a row.

California isn’t unique. The renewable energy industry overall is creating jobs at a rate of 12 times the rest of the U.S. economy. One recent study found that putting cities on a climate-friendly growth trajectory could save as much as US$22 billion by 2050 and avoid carbon emissions equal to India’s entire annual footprint.

The private sector sees this. When the CPP was instated in 2015, 365 companies and investors, including General Mills, Mars Inc., Nestle, Staples, Unilever, and VF Corporation, wrote a letter in support of the plan. In it, they stated that their “support [was] firmly grounded in economic reality … Clean energy solutions are cost effective and innovative ways to drive investment and reduce greenhouse gas emissions. Increasingly, businesses rely on renewable energy and energy efficiency solutions to cut costs and improve corporation performance.”

Since then, four of America’s largest companies—Amazon, Apple, Google, and Microsoft—filed amicus briefs in support of the CPP. As large consumers of electricity, these businesses sought to limit their environmental impacts in response to concerns about climate change. While they have developed their own renewable energy facilities to meet their sustainability goals, they argued that the Clean Power Plan would provide them with more and more cost-effective options. 

Even in the traditional energy industry, which arguably is more vested in a coal-friendly future than business writ large, not all companies have the same perspective on the CPP. While Peabody, America’s biggest coal miner (which came back from bankruptcy under the new U.S. presidency), welcomed the repeal, utilities have not been as vocally opposed. In fact, Reuters found that of 32 utilities in the 26 states that filed lawsuits over the CPP, “the bulk of them have no plans to alter their multi-billion dollar, years-long shift away from coal.” 

Business action in favor of climate-compatible solutions gained momentum leading up to the Paris Agreement in 2015, and it has continued since. For example, 619 companies are taking bold climate action through the We Mean Business coalition, which represents a market capitalization of US$15.5 trillion, including 32 companies with individual market capitalizations of more than US$100 billion. These companies emit a total of 2.31 gigatons of in their direct operations and purchased electricity, which is equivalent to the annual emissions of the Russian Federation. Moreover, more than 100 of these influential companies are committed to sourcing 100 percent renewable power globally, working to massively increase demand for—and delivery of—renewable energy.

Not only do the economic claims of the current EPA seem unlikely, but there is increasing evidence that the agency’s policies may harm the economy. Companies recognize this, which is why we’ve seen so much business support for the CPP. It’s also why business will continue to lead on climate action more broadly, even if it must do so without the policy frameworks that support U.S. leadership on this issue. Indeed, other countries around the world, including China, increasingly recognize that climate leadership translates to economic leadership—a perspective that they are likely to be rewarded for in the long run.

Blog | Monday January 29, 2024

Ten Guiding Principles for Co-creating Climate Justice Interventions

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While business leaders are starting to consider how climate change disproportionately affects people and communities, there are few examples of how the private sector is working with affected stakeholders. In fact, at a BSR hosted “Roundtable Discussion on Climate Justice and Authentic Collaboration”, 70 percent of business participants indicated that they need support in understanding how to approach climate justice.  

By incorporating a co-creation process, business leaders can center communities most affected by climate change in ongoing discussions as they experience the injustice firsthand and can identify solutions that best fit their needs. Thoughtful and intentional co-creation facilitates conscious inclusion of those who historically were or are excluded from both policy and business decision-making processes​; presents an opportunity to address disparities and systemic inequities​; and enhances institutions and climate solutions through diversity of experience, thought, and expectations. ​  

Co-creation can also offer a level of innovation and creativity in climate solutions that far exceeds what could be achieved if done alone. To deliver benefits to both affected communities and businesses, it is essential to work directly with affected communities and local community-based organizations at the onset—not separately or at later stages after decisions and investments have been made. 

The following 10 principles can guide businesses in co-creating climate justice interventions with affected communities.  

1. Listen First and Listen to Learn 

When engaging communities, companies should come prepared to listen to learn and foster understanding of the affected stakeholders’ experiences, perspectives, needs, resources, and capacities.  

2. Move at the Speed of Trust 

Budget time and resources appropriately for thoughtful decision-making and manage expectations on the amount of time necessary to build mutual respect and trust. A timeline for the specific intervention should be agreed on, and regular checkpoints to reassess progress and comfortability will allow all parties to understand when timelines should be adjusted. While progress may be slower, outcomes are more likely to be just and sustainable for all parties.  

3. Cultivate an Inclusive Environment 

Inclusive representation and culturally sensitive, respectful language to cultivate an inclusive environment will promote trust-building. A culture of inclusivity will give stakeholders agency and a platform to voice their opinions and perspectives from lived experience, enhancing the business-community relationship.  

4. Communicate Transparently 

Stakeholders—from investors to consumers to workers—are calling on companies to provide increased transparency on climate action. To foster and maintain trust, ensure communication and feedback between the company and affected communities are open, honest, and timely and objectives are transparently shared.  

5. Ensure Mutual Benefit  

Affected communities have the most to lose from climate change but are often excluded from an equitable share of the benefits of climate solutions. Benefits should come from what the communities themselves are asking for, not what the business may imagine communities need or want.  

6. Contend with Systemic, Historic, and Contemporary Injustices 

Recognize, take responsibility for, and remedy past and current community harms for which businesses have caused or contributed, and use leverage to address harms to which the company is linked. Understand how existing structures, societal norms, and frameworks exclude the needs of disproportionately affected communities and consider how leadership, resources, and decision-making be redirected to those most affected and historically excluded.     

7. Welcome Discomfort 

Real and meaningful engagement on climate justice requires learning and reflection. By embracing dialogue and acknowledging feedback, businesses demonstrate that they are undertaking the necessary work, introspection, and accountability.  

8. Include Last-mile Communities 

Seek to involve last-mile communities—communities in rural, peri-urban, and urban areas that lack access to basic services such as water, sanitation, electricity, cellular devices, and transportation. Last-mile communities are often left out of stakeholder engagement and are isolated due to limitations like language barriers or inaccessible internet and communication tools.  

9. Engage for the Long Term 

Similar to other social justice efforts, climate justice requires companies to make a long-term commitment to the communities with whom they engage. From learning and listening to acting and fostering equitable partnerships, companies need to approach climate justice with the understanding that it requires sustained and deep engagement over time to enable trust-building and lasting change.  

10. Continuously Evaluate and Adapt 

Continuously monitor and evaluate interventions to ensure they are achieving desired outcomes and responding to shifting priorities and circumstances as well as the recommendations and needs of communities most affected by climate change. Adapt interventions as needed based on key learnings throughout the process and evolving pressures and challenges associated with addressing climate change.  

The principles, while ambitious, are meant to inform and steer co-creation between businesses and affected communities. Business actions aligned with these principles can better forge relationships with affected communities, build trust, and make collective progress toward climate justice. 

The 10 principles are summarized from a more in-depth BSR issue brief that provides additional context for co-creation as well as an approach that outlines recommended phases of activity for co-creating climate justice interventions between business and communities. 

Primers | Tuesday June 13, 2017

10 Human Rights Priorities for the Financial Sector

Preview

Human rights are inherent to all human beings. They are defined and established in more than 80 international legal instruments¹ and define the fundamental protections of human dignity, needs, and freedoms, such as food, housing, privacy, personal security, and democratic participation.

Since the adoption of the Universal Declaration of Human Rights (UDHR) in 1948, the responsibility to protect human rights has primarily fallen on governments. Beginning in the early 2000s, however, it became increasingly clear that the freedoms enshrined in the framework could also be violated—and promoted—by the private sector.

In 2011, the UN Human Rights Council unanimously endorsed the UN Guiding Principles on Business and Human Rights (Guiding Principles), the first international instrument to assign companies the responsibility to respect human rights. The Guiding Principles state that governments must put in place good policies, laws, and enforcement measures to prevent companies from violating rights; that companies must refrain from negatively impacting rights even when governments are failing to create or enforce necessary laws; and that victims of corporate abuses must have access to effective remedy. As part of this responsibility, the Guiding Principles require companies to undertake due diligence to identify and manage their negative human rights impacts.

This primer identifies the 10 most relevant, urgent, and probable human rights impacts for businesses operating in the financial sector. The information here is gathered from BSR’s direct engagement with financial sector companies, as well as our 25 years of experience helping companies in all sectors manage their human rights risks.

The financial sector comprises a wide range of businesses and activities, from asset owners and managers to private equity, venture capital, and commercial banking. While each of these sub-sectors will have its own human rights profile and challenges, this brief highlights universal risks for companies operating in finance.

Blog | Tuesday October 27, 2020

Four Features of Effective Human Rights Due Diligence

Preview

This blog is the second of a three-part series. In the first blog, we focused on the current landscape of mandatory human rights due diligence (HRDD), disclosure requirements, and the push towards a more universal approach. This blog will discuss the elements that BSR has found important for effective HRDD, and our third blog will focus on further unpacking the various options being proposed in the European Union’s mandatory Human Rights Due Diligence Legislation (EU mHRDD).

The EU’s proposed mandatory human rights due diligence legislation has the potential to reshape the way that companies manage their human rights risks—and to boost the impact of company efforts to prevent, mitigate, and remedy these risks. In line with the UN Guiding Principles on Business and Human Rights (UNGPs), the EU directive will require companies to carry out effective due diligence to identify, prevent, mitigate, and account for actual and potential human rights and environmental impacts in their own operations as well as in their upstream and downstream value chains. The European Commission is expected to submit a formal legislative proposal in early or mid-2021, with the legislation expected to come into force by early 2022.

As we anticipate the new regulations requiring due diligence, the question for companies then becomes: What does “effective due diligence” look like?

To be impactful—to achieve the desired outcomes of reduced human rights abuses and increased realization of human rights—effective due diligence requires more than a tick-box approach to process and procedure. Over the past 25 years, BSR has worked with companies to manage human rights risks, including more than 200 human rights impact assessments and implementation plans. Drawing on these learnings, we emphasize four features of effective human rights due diligence:

1. Effective human rights due diligence is forward looking. The forward-looking nature of human rights assessments is one of the most powerful tools companies have to ensure respect for human rights. By identifying potential impacts in advance, companies can put in place actions to prevent and mitigate harm. As stated in the UNGPs (Principle 18), human rights due diligence should be conducted prior to any new activity or relationship and prior to significant business decisions or changes in operation. Futures thinking and strategic foresight methods, such as trend analysis and scenario planning, enable companies to increase the range of potential adverse human rights impacts identified and surface new strategies to address those impacts. BSR’s new quarterly emerging issues brief, The Fast Forward, can help companies to track nascent disruptive trends.
    
2. Effective human rights due diligence is ongoing. Due diligence should not be a one-off event. Ongoing due diligence enables companies to track shifts in the operating environment—such as new laws or rising social tensions—that may change their human rights risk profile. The ability of a company to nimbly respond to such change depends not only on formal processes for updating risk assessments. It will also require regular stakeholder engagement (including dialogue with human rights defenders) as well as a culture of sharing and escalating internal concerns to the appropriate decision-makers inside the company. The most effective programs we have seen have integrated recurring due diligence checkpoints in their operations.
    
3. Effective human rights due diligence recognizes the company as part of a system. No matter where they are located or what industry they are in, companies operate in geographical contexts and product value chains that are shaped by preexisting dynamics. These dynamics can produce human rights abuses in which companies may become complicit, such as systemic racism in the U.S., gender-based violence in India, and confiscation of Indigenous lands across Latin America. While companies may cause or contribute to individual adverse human rights impacts, these harms occur in the context of the wider system. Companies should understand their role in shaping these systems and the ways their actions, combined with those of other companies, cumulatively impact people. Companies can effect change in these systems and increase their leverage, impact, and legitimacy by collaborating with other actors. This is particularly the case in fragile and conflict-affected contexts. In these cases, companies and other actors can assume a shared responsibility to address the multiple and intertwined causes of conflict and human rights violations in combination, increasing the likelihood of beneficial outcomes for everyone. Additionally, companies should understand how their internal ecosystem may affect the success of human rights programs: contradictory commercial targets, political advocacy, and business priorities may work against a company’s own human rights commitments.


4. Effective human rights due diligence is grounded in stakeholder engagement—especially with the most vulnerable. Rightsholders—the employees, customers, users, supply chain workers, and community members whose rights are impacted by company decisions, products, and operations—provide information that enables companies to understand their human rights risks. They do this by raising concerns about actual and potential impacts and by providing input about how best to address and remediate these impacts. Companies should make extra effort to engage with vulnerable groups to avoid aggravating structural oppression and disproportionately negative impacting people who are at heightened risk. Proactive consultation, formal grievance mechanisms, and ongoing dialogue with people who are impacted in different ways by the company’s business activity positions the company to design, implement, and track the effectiveness of their human rights due diligence programs.

Ultimately, human rights due diligence is about preventing, mitigating, and remedying harm to people impacted by business. To be meaningful, companies must look beyond process to real-world outcomes and ensure that their teams have the knowledge, the skills, and the relationships to shape these outcomes for the better. We believe that mandatory human rights due diligence requirements should be designed to support rather than hinder these four features of effective human rights due diligence.