Groupthinking to oblivion

Last week, I attended the latest in a long series of conferences, round-table events and discussion evenings on sustainability. It had its moments. But a defining feature of these events is consensus – lots of it. Delegates from businesses large and small, NGOs, academics, the media, governments – all without fail voice their concerns about the parlous state of the planet, often quoting alarming statistics about the number of new power stations in China or the plight of fish stocks in the North Atlantic, and violently agree on the need for wholesale changes in consumer, state and corporate behaviour. Trenchant debate about how to achieve this is frequently lacking.

Now, as a pollster, you don’t need to tell me that what we have here is a self-selecting sample. If you’re either apathetic or professionally sceptical about the environmental challenges we face – which, for the record, I am not - you are unlikely to choose to spend your time at these events.

This is certainly not to say that we can dismiss these gatherings out of hand – the sheer number of them, for one thing, tells us that there’s a genuine groundswell of concern out there. But for those looking for explanations as to why we haven’t seen this mushrooming of bien-pensant concern translate (by most measures) into behaviour change on the scale required, perhaps University of Manchester psychologist Geoff Beattie’s new book can help.

Using ‘implicit association tests’ he has investigated how our stated attitudes differ from our unconscious biases and instincts, and has come to the conclusion that we aren’t as green as we think we are. He estimates that between 40 and 50% of people have ‘implicit’ attitudes towards sustainable consumption that don’t match their ‘explicit’ ones.

From a GlobeScan perspective, it wasn’t a huge surprise to read this. We’ve seen the number of self-described ‘ethical consumers’ in our surveys – those who claim to reward or punish companies on the basis of their sustainability credentials – balloon massively in the past few years. Now, are 62% of American consumers really going out there and punishing irresponsible companies, as they told us in 2009? Sales data would suggest not. So what’s happening here?

What’s undeniable is that environmentalism, to a greater or lesser degree, has become the new orthodoxy. The way that sceptics present their case illustrates that, with much talk of ‘a conspiracy’ to hoodwink the public. In that context, we should not be too shocked if people feel a social pressure to pay lip-service to attitudes that they don’t really hold, or if they exaggerate their commitment. People would like to think they are ethical consumers. Hysterical talk of climate change ‘deniers’ – with its overtones of the Holocaust and David Irving – will hardly help the situation.

It’s been said that climate change is the ultimate political, rather than technical problem. Moving to a sustainable world will require creativity and a real understanding of what makes people behave the way they do. Memo to those who share this laudable objective: groupthink and demonization of those who disagree won’t cut it.

The birth of a new megatrend?

The IT revolution; electrification; the rise of mass production; globalization. What do they all have in common? According to Harvard Business Review, they are all megatrends, and sustainability should now be added to the list.

In business terms, a megatrend – the term was coined back in 1982 by John Naisbitt in his bestseller of that name – is a major societal or economic shift that ‘force[s] fundamental and persistent shifts in how businesses compete’.

Many businesses have certainly found themselves struggling to cope with the greater expectations being placed upon them to improve the sustainability of their processes, products and services. Our regular study of experts in the field reveals that those in the know rate companies only just ahead of government, and a very long way behind NGOs and social entrepreneurs, in terms of how well they are seen to be advancing the sustainability agenda. And while some companies do seem to have taken sustainability to heart and integrated it into their core strategy – our expert panel rates initiatives like Walmart’s Sustainability Index and GE’s Ecomagination particularly highly – other high-profile campaigns like BP’s Beyond Petroleum are seen to have foundered when they came up against a succession of crises and scandals, of which the Gulf of Mexico oil spill is only the latest. Incoherent, inconsistent or insincere initiatives, it seems, aren’t impressing anyone.

But perhaps this criticism underestimates the change in mindset that is taking place within the corporate world. Despite the challenges, and setbacks like Copenhagen, the drive to greater sustainability shows no sign of abating. And as HBR points out, while government is starting to regulate as never before, companies – critically - are betting that investing in innovations in low-carbon technology and energy efficiency will pay long-term dividends. This megatrend is just getting going.

A see-through world

What makes a responsible company? It's a fair question. Terms such as CSR, sustainability and corporate citizenship are on everyone's lips these days. Even so, there is often a sense that they mean different things to different people.

But sometimes an issue cuts through. As the world economy attempts to put itself back on its feet, somewhat bloodied and bruised after the experience of the last couple of years, transparency is suddenly the buzzword du jour.

Our annual study of consumer views of CSR across 30 countries asks people to say what they consider to be the most important thing a company could do to be considered socially responsible. Treating employees fairly still tops the list, but behaving transparently and ethically is coming up hard on the rails – it was named spontaneously by just 8% of our global sample of consumers in 2005, 10% in 2008 but 20% this year. In the wake of the economic crash, when lots of apparently sound businesses turned out to have feet of clay, consumers increasingly want the whole picture about the companies they deal with, warts and all.

This is backed up by a Business Week survey of the world's top 100 brands, as Sustainable Life Media reports. Trust and transparency top the list of consumer concerns in 2009. The piece also makes the point that as well as expecting companies to keep them fully informed of what they're up to, consumers are quite prepared to use the opportunities the internet affords them to make sure that, when a company falls short, everyone knows about it.

We also share the assessment here that water use is going to be a big, big issue for companies over the next decade – and increasingly, one of the issues on which consumers will be expecting them to be transparent and lay their cards on the table. Water emerged as one of the most pressing issues in our survey of sustainability experts around the world at the end of last year, and our 15-country study of consumer views on the issue revealed that 72% considered water pollution to be a 'very serious' issue and 71% felt the same way about fresh water shortages.

Responsible water use is, in one way or another, a pressing issue for all sectors, not just heavy industry or beverages – and the way companies handle it is likely to be a litmus test of how they respond to the challenges of an increasingly see-through world.

Transformational Corporate Sustainability – The Salon

Every few months, we invite ‘friends of GlobeScan’ - clients, fellow consultants and members of our network from across the world of business, NGOs, media and government - to join us for a Salon. These are informed but informal discussion evenings on one of the issues we regularly research, over organic beer and snacks at our offices in London. On Tuesday, speakers from GSK, Fairtrade, InterfaceFLOR and SustainAbility shared their thoughts about transformational leadership in sustainability.

This time last year our Salon’s focus had been on ‘the great disruption’ - the ongoing financial meltdown then at the forefront of everyone’s minds. Would it prove to be a turning point and the herald of the birth of a more sustainable global economic system, or merely a hiccup in business as usual? As SustainAbility’s Mark Lee, the evening’s moderator and co-host, pointed out, even if the crisis had had a profound impact on the pace and nature of the sustainability debate, the fact that a year later we were now able to meet and discuss the further transformational leadership needed could be construed as reason to be cheerful.

GlobeScan’s Chris Coulter opened with some findings from The Sustainability Survey – our regular study of experts opinion across business, NGOs, academia and government conducted as a joint venture with SustainAbility. This highlighted the growing sense of urgency surrounding sustainability, and also the ‘changing of the guard’ we’ve noted here before in terms of perceived leaders in sustainable business, with new names like GE and Walmart starting to emerge alongside the established names.
The two companies on the panel, both leading lights in their respective industries, symbolised this shift, with Interface having made the leap in 1995, but GSK’s renewed commitment coming more recently with the arrival of a new CEO.

Much of the discussion, indeed, focused on the role of CEOs in driving sustainable change. Thanks to some live polling with our audience, while we knew that 75% of our audience were optimistic that most FTSE100 companies would embrace sustainability at the core of their operations in the next decade, many saw CEOs as a major barrier to doing so. Not all agreed, though - few CEOs these days, we heard, are actively hostile to sustainability. Others stressed that CEOs leadership was indispensable – they were often uniquely able within a company to decide to take a longer-term view of an issue and override targets that other staff were subject to. The two corporate panellists both highlighted the central role of Interface’s Founder and Chairman, Ray Anderson and GSK’s CEO, Andrew Witty – had played in their company’s sustainability efforts.

Most seemed to feel that companies now best positioned to lead on sustainability and become transformational leaders were those that had integrated it into their activities before the recession took hold. InterfaceFLOR Europe CEO Lindsey Parnell said he thought that sustainability was now so embedded within his company and so much a part of how its people saw themselves that the culture would survive any change at the top. In contrast, the feeling was those companies that hadn’t already embraced sustainability so were now too preoccupied with survival to contemplate major culture changes.

But there were felt to be other barriers preventing transformational leadership by companies. GSK’s Duncan Learmouth questioned whether the short-term focus of financial markets was a major obstacle to transformation and a limit to companies’ ability to act on their own. He also highlighted the lack of reliable data and analytical tools available to corporate leaders, without which the adoption of a fundamentally new business model was just too much of a risk. Fairtrade’s Barbara Crowther stressed that market mechanisms still failed to adequately price in ‘externalities’ – environmental and social harm – and that greater regulation was needed. A more responsible approach to marketing, she thought, was also key, with less messaging focusing solely on tempting consumers with too-low prices.

So, was the tipping point coming soon? Most of the panellists thought it was, even if greater consumer impetus was needed to push companies over the edge. And meanwhile, perhaps sustainability as a professional discipline has come of age – as Chris Coulter pointed out, many of those involved in the development of CSR have now racked up the ’10,000 hours’ supposedly required to become an expert in any field. Maybe in 2010 we’ll start to see the fruits of that expertise.

Running on...

The 'peak oil' debate - are we or are we not about to reach the limit of our global capacity to extract oil from the ground, and what does this mean? - rumbles on without any sign of a resolution.

Peak oil proponents, like US investment banker Matthew Simmons, assert that most of the accessible reserves of oil will be drilled out within ten to fifteen years, and that the global economy - and particularly gasoline-dependent countries like the USA - risk decades of economic and social upheaval as they try to adjust to a less oil-thirsty lifestyle. Many disagree strongly. Some respected commentators, like former Shell chief economist turned senior UK politician Vince Cable, believe that the case has been overstated and that there is plenty of oil still in the ground - but point out that we risk becoming increasingly dependent either on supplies either from unstable neighourhoods such as Iraq, or from 'unconventional' - and expensive - sources like the tar sands in western Canada

And others still say that all of this still misses the point – that regardless of reserves in the ground, norms, expectations and regulations are shifting rapidly towards an assumption of lower oil usage. It’s quite possible that as people start to perceive the upside of this shift, lower usage will follow. As Alcatel-Lucent chairman Ben Verwaayen pointed out at BSR last week – the move to a sustainable economy is going to change our lives more than the Internet. We shouldn’t assume the old expectations will hold.

The lack of any emerging consensus in the peak oil debate is borne out in our public opinion data. When we asked people in 23 countries last year whether the world will 'continually produce more oil' or not, 47% agreed and 42% disagreed. But the public, at least, seems to take a relaxed view of how we might cope with declining oil production - 64% agree that their country can generate enough energy from renewable sources to replace coal, oil - and nuclear - in 20 years.

Whether this is overly optimistic is an issue partially addressed by an interesting new report from the UK Energy Research Council, which looks to have moved the debate forward. Yes, they concede, there may still be large reserves of conventional oil still available. But technical limitations mean they are unlikely to be exploited quickly enough to compensate for the decline in the 'mature' fields - and we may see production peak anyway before 2020. The push for renewables and greater fuel efficiency in climate change policy will help - but there will also be a 'strong incentive' to exploit high carbon non-conventional fuels such as liquefied coal, with potentially disastrous environmental consequences. And they warn that the ongoing volatility of oil prices - which spiked again this week amid economic uncertainty - remains a major disincentive to investment in the sort of alternative energy strategies that the public confidently seem to expect.

Looks like the peak oil debate has a while to run yet.

Strong Copenhagen Agreement Unlikely, Despite Potential Benefits: Sustainability Experts Speak

The latest findings from our regular poll of sustainability experts around the world from the worlds of business, academia and NGOs illustrates the ambivalence that many of those in the know are feeling as the Copenhagen summit approaches.

On the one hand, they are exceptionally downbeat about the prospects for a meaningful agreement being concluded at Copenhagen - that is, one stringent enough to avert the major and frightening consequences for the climate that most scientists now predict. More than eight out of ten anticipate that, while a total failure to reach agreement is unlikely, the compromise that emerges won't be tough enough to make much of a difference.

But on the other, they see real prospects for a wave of innovation and investment in renewable energy, and low carbon products and services if a really radical agreement is reached. This is important, as it seems to suggest that experts largely don't subscribe to the view that the dynamic between the environment and the economy is a zero-sum game - that is to say, the more you try and fix one, the more you damage the other. With Hu Jintao committing China last week to producing 15% of its power from renewables and nuclear energy by 2020, this is clearly the way the tide is shifting.

Whether it will shift fast enough to avoid us all being engulfed, in the absence of a more ambitious agreement in Denmark in December than currently looks likely, is quite another matter.

A New Economy? Looks Suspiciously Like The Old One

Is a 'new', more sustainable economic model in prospect as the world attempts to pull itself out of recession? That's the question we posed at the latest of our regular 'salon' discussion evenings last night. We had distinguished speakers from Philips (Josephine Green), the BBC (Andrew Walker) and Sally Jeanrenaud of the International Union for the Conservation of Nature, and a diverse audience drawn from across the corporate and NGO world.

The discussion was certainly fizzing with ideas, but on the whole, the consensus was pretty downbeat - no, a new economic model was not around the corner. Many seemed to feel that the impressive rhetoric of government leaders about committing large sums of money to a low-carbon and sustainable economy is very far from being realised. And as far as reforming the wild excesses of global capitalism was - one panellist commented that he fully expected to see the economic high-rollers back at the gambling tables of the world's financial markets within a couple of years - even if perhaps with not quite as many chips as they had before the crash.

A number of hypotheses were floated - was a testosterone-driven, 'fight or flight' mentality in the upper echelons of business, finance and government to blame for the crisis? Are we suffering from the dominance of an orthodoxy that believes that a boom will always follow a bust, no matter how severe? Or is the main problem a lack of effective structures for international policymaking, and a political short-termism that's hard-wired into most of our modern democracies? There was no shortage of diagnoses, but optimism that a cure could be found was lacking.

But if it is indeed to be back to business as usual - for now - it's in the teeth of mounting unhappiness from the global public. Our latest data shows that support for both globalisation and the free market economy continues to erode. But in the absence of a clearly articulated alternative model for organising the world, what chance is there of real reform taking place?

Those looking for a silver lining have to search hard. We did find that the proportions believing that their children and grandchildren will have a better quality of life has increased, just a little. But before things get better, our salon felt they might be about to get a whole lot worse...

New Global Water Certification Program Responds to Water Worries

Water sustainability is a major emerging issue and one that affects a huge number of people. Climate change is expected to lead to increased drought, while a growing (and in some parts of the world increasingly prosperous) population puts increasing pressure on scarce water resources. The BBC notes that the malnourishment of more than 800 million people is associated with a lack of water to grow their food, while water-borne diseases affect more than half of people currently occupying the world’s hospital beds. Safe, clean drinking water is a luxury that more than one billion people have to do without.

The World Water Week in Stockholm, Sweden, is an annual meeting where experts, practitioners, leaders, and decision-makers get together to focus on the world’s most urgent water-related issues. Held August 16-22, this year’s meeting brings together perspectives of scientific, business, policy and civic sectors from around the world to explore the theme of access to water in the face of uncertain availability coupled with growing demand.

One solution to the problem of unsustainable water use, put forward at the summit by a group of leading business, social development and conservation organizations, is the development of a new voluntary global water certification program. The Alliance for Water Stewardship has been created to develop best-practice standards for managing water responsibly and to recognize responsible corporations, farming operations, cities, and other water users through certification, similar to the certification of sustainably harvested wood by the Forest Stewardship Council (FSC). Certified companies and other water users would need to meet standards on environmentally sustainable as well as socially beneficial water use.

We've been finding for a while that people around the world are becoming increasingly worried about water- and are indeed more concerned about it than about other high-profile environmental problems like climate change or species depletion. So surely companies that take the issue of sustainable water use seriously deserve to be recognized? A recognized system of certification would make it easier for consumers to make ethical choices, and would benefit companies that recognize just how precious this finite resource really is.

The Sustainability Survey: Experts Read the Runes

We’ve just completed our latest – bigger and better – annual study of experts in sustainability around the globe. Every year, we ask a senior sample of thinkers and doers working within companies, academic departments, NGOs, consultancies and government to read the runes and tell us which way they think the sustainable tide is flowing, and what the major issues are that will preoccupy us in the next twelve months. Over the years, they’ve proved to be remarkably prescient – anticipating the spike in concern on climate change and water as a resource, for instance.

One thing is clear from this year’s study (which we're now working with SustainAbility to deliver) – even if business is starting to embrace a sustainable agenda, it’s not yet leading the charge. The sustainability experts we spoke to rate corporate leaders far behind NGOs in terms of the job they’re doing in advancing the sustainability agenda. In fact, the only group felt to be performing worse than corporate leaders are nationally elected government leaders – the Copenhagen climate summit will demonstrate whether this downbeat assessment is fair. But this hardly bodes well for progress over the next few years, given that those are the two are those that actually have the power to effect change through their own actions, rather than by exerting pressure on others.

This isn’t to say that the picture is entirely gloomy, and what’s notable is that a new generation of corporate leaders in sustainability appears to be emerging. We ask experts to tell us which companies they regard as leaders in sustainability, going beyond what’s required of them by law, pursuing the agenda aggressively and integrating it into their strategy. Companies like Shell, BP and Interface have topped the list for a number of years and continue to do well, but new names are emerging, including Marks & Spencer, Walmart and GE, and companies criticized in the past such as Nike.

They’re a diverse bunch, but what they appear to have in common is a strong, often consumer-facing brand. They’re used to communicating in a compelling way and distilling what they have to say into a theme that really connects with their various audiences – making their sustainability commitments an integral part of their brand, rather than an afterthought.

A New Brand of Sustainability

Jez Frampton, the chief executive of Interbrand, has written a thoughtful piece about the relationship between brands and sustainability. He’s pointing up the potential for brands to contribute to the development of sustainable products and services that answer consumers’ needs and speak to people, while still being responsible.

Undoubtedly, as sustainability continues to entrench itself and pressure from corporate peers, government and consumers increases, the role will increase for innovative, successful and respected brands to reassure and engage consumers – and overcome some of the misgivings many still have about sustainable alternatives – they’re not as good, they’re not worth the money, they don’t live up to their claims, and so on.

Our latest survey of sustainability experts – of which more in the next post – highlights the fact that major brands like Google and Marks and Spencer are increasingly being cited as leaders in sustainability – which can only be good for both the credibility of both the brands concerned and sustainability as a cause.

I’m less optimistic than Frampton, however, that people will be able to ‘see through’ the greenwash put about by less responsible companies as easily as he seems to think – or even to agree on what responsible behaviour looks like.
The two mega-brand examples Frampton cites – GE and McDonalds – have indisputably been enhanced by a concerted effort to associate them in consumers’ minds with a more sustainable approach to business.

But while most would agree that GE’s partnership with Abu Dhabi to create the world’s first carbon-neutral city looks like a significant step in the right direction, it’s less clear that McDonald’s anti-litter campaign will weigh in the balance as heavily with concerned consumers when set against the overall carbon impact of raising all those burger-destined livestock. As major brands continue to embrace sustainable rhetoric, expect to have to do a lot more disentangling of which ones really mean it.

Food Prices - The Silent Financial Crisis?

Interesting to see that Barack Obama has managed to persuade G8 leaders to contribute US$12 billion over the next three years to a food security initiative, according to the New York Times. The Times reports that it'll provide 'emergency anti-hunger aid to poor countries and also help build sustainable, productive agriculture and food delivery systems'.

This seems like a wise move, after the price of staples such as corn, rice and wheat rocketed in mid-2008, causing food riots in developing countries including Egypt and Haiti. Prices have since fallen back, but the latest report from the economists at the UN’s Food and Agriculture Organisation (FAO) warned that there was a chance of farmers cutting their plantings in response to a drop in demand caused by the global recession, and of a return to the shortages, high prices and associated social unrest of last year.

The food price spike has been something of a silent financial crisis, affecting as it does the global South much more than developed nations. But our data suggests that across the globe, high food prices have in fact had a much more direct effect on people’s lives than the global financial crisis or the credit shortage. Nearly half (47%) of those in the 24 countries we polled for BBC World Service earlier in the year felt that high food prices had affected them ‘a great deal’, compared to 31% who felt that way about the downturn in the global economy, and just 21% who felt they had been affected a great deal by the shortage of financial credit.

Obama deserves plaudits for continuing to engage on this issue despite the fact that it’s no longer making headlines.

Sustainability is Sticky

The recent New York Times article, “Is a Food Revolution in Season” is remarkable in that it identifies the serious attention being paid to what some consider a peripheral issue - sustainable agriculture.

I find it incredible the endurance of sustainability and corporate responsibility as a topical and relevant issue of the day. The worst economic crisis in 80 years hasn’t dented the intense interest in public discourse around climate change, health and wellness, and ethical corporate behaviour.

The ongoing relevance of sustainability is borne out in GlobeScan’s ongoing tracking of societal views and expectations across the world - our latest global poll across 30 countries shows a growing interest among consumers to reward and punish companies based on their social and environmental performance. This “stuff” continues to matter to people even as they grapple with serious economic hardship and dislocation. President Obama’s attempt to bundle a host of issues - health care reform, action on climate change, education improvements, and regulatory changes to the way business operates - is in line with the public’s mind set.

Tracking Sustainable Consumption

Today National Geographic and GlobeScan released the results of the second annual Greendex survey. The Greendex is a unique and comprehensive annual survey designed to measure consumer behaviour in areas relating to housing, transportation, food, and consumer goods. The Greendex ranks average consumers in 17 countries according to the environmental impact of their consumer choices, as well as choices that are largely controlled by circumstance, such as climate, the availability of green products, and the availability of public transportation.

Overall, the results are positive. Notwithstanding the turbulent economic conditions of the past year, Greendex scores are up from 2008, meaning consumers are engaging in more sustainable behaviour, in 13 of the 14 countries surveyed in both 2008 and 2009. The increase is attributed to sustained environmental concern stemming from high concerns reported in early 2008, combined with the tightening of wallets in the face of recession. In other words behaviour that is good for the environment, such as using less water in the home and not leaving the air conditioning on overnight, just so happen to be behaviours that are good for the pocketbook. Consumers are realizing this and have started to jump on board.

Yet the question remains: will behaviours that are currently being driven by short-term needs evolve into sustainable “green” lifestyle choices when the economic crisis subsides?