In 1973, Bob Marley released the protest anthem “Get Up, Stand Up.” Those words are very much in my head today as I consider the implications of the U.S. withdrawal from the Paris Climate Agreement. The agreement was signed in December 2015 by 196 members of the United Nations Framework Convention on Climate Change.
The reaction by companies has been swift and decisive. Here is an example from our client HP Inc.: “Climate change is one of the most significant and urgent issues facing business and society today. The science is clear, the impacts are serious and the need to act is essential. At HP, we see this not only as our responsibility but vital to the longevity of our business. We support the Paris Climate Agreement and the global efforts to address climate change. HP is working to ensure that our business is resilient, innovating to mitigate the effects of climate change, and adapting to an evolving global business and regulatory environment that supports our customers, partners and employees.”
Dozens of companies signed an open letter in The Wall Street Journal to President Trump, including Apple, Bank of America, Campbell Soup, Cargill, Coca Cola, Dow, Goldman Sachs, Google, Intel, J&J, JP Morgan, Microsoft, Morgan Stanley, P&G, Salesforce, Tesla and Unilever. There were tweets by several CEOs, including Jeff Immelt of GE (“Disappointed with today’s decision on the Paris Agreement. Climate change is real. Industry must now lead and not depend on government.”) and Satya Nadella of Microsoft (“We believe that climate change is an urgent issue that demands global action. We remain committed to doing our part.”)
In addition, a group of cities, states and businesses have banded together to support the greenhouse gas emission targets established in the Paris Accord. The group will submit their plan to the U.N. Mike Bloomberg, former mayor of New York City, said he will provide much of the $15 million that the U.N. will lose from U.S. funding on the climate accord.
We are at a perilous moment, when the majority of the world’s population has lost trust in the system. Our 2017 Edelman Trust Barometer showed that the gap between elites and mass attitudes towards institutions has never been so wide. There is little confidence in the world’s leaders; in fact, heads of state and CEOs are perceived as among the least credible. The implosion of trust has caused a loss of belief in the future and a deep sense of unfairness on division of resources.
Here are specific reasons why business should fill the void left by government on the sustainability front, based on our latest Trust Barometer:
- There are new expectations of business to make money and improve society. Seventy-five percent of our respondents said they expect business to do both.
- Business is the last retaining wall in the tsunami of distrust that is engulfing the major institutions of the world. For those who are undecided about whether the global system functions in a fair manner, business is the most trusted institution.
- The most credible spokesperson is now “a person like yourself,” speaking on a peer-to-peer basis on the basis of shared interests and values.
- The most important way for companies to earn trust is to treat employees well. The employee needs to be kept apprised and inspired through tangible actions.
Today, the Business and Sustainable Development Commission is meeting in Singapore (I am one of the commissioners). At Davos, the BSDC released a study that showed that instead of being a constraint to growth, business, by following the Sustainable Development Goals of the United Nations, could open up economic opportunities worth $12 trillion and increase employment by nearly 400 million jobs by 2030. Asia represents 40 percent of that financial opportunity and 66 percent of the potential jobs, representing ultimately 12 percent of the work force in Asia.
Mark Malloch Brown, chair of the BSDC, said, “The Asian century is threatened by persistent inequality, environmental collapse and unabated climate change. We need to turn these challenges into opportunities that reward both business and society.” One example is the micro-entrepreneur program sponsored by Mars Inc. in Kenya, which began with seven enterprises and now is up to 500, in all aspects of the supply chain. Another is telecom company Telefonica’s announcement that it would source 50 percent of its energy from renewable sources by 2020.
By proceeding as individual enterprises to modify supply chains, to change consumer behavior (cold water wash works as well as hot), and to partner with civil society in establishing constructive regulatory frameworks, business can lead the way at a time of government paralysis.
Richard Edelman is president and CEO.