Business and Sustainability

Business increasingly participates in co-regulatory and self-regulatory arrangements along national governments, international organizations, civil society and private-public institutions. These co-regulatory and self-regulatory arrangements span multiple political arenas and jurisdictions from the community level to international relations. Fair trade and energy consumption labels, accounting and transparency standards as well forest certification and emissions trading are well known examples of the increasing role of business in the dynamic regulatory space.

Efforts to set up regulations are widespread in policy-domains that form part of the larger sustainability discourse. Demands to put sustainability and sustainable development onto the political agenda and the occurrence of business co-regulatory and self-regulatory arrangements have evolved in fairly parallel fashion since the 1990s. Business is frequently portrayed as the main (and often the only) source of environmental pollution, of decomposing social relationships and values through the exploitation of workers, of implementing profit and utility-maximization behaviour, of globalizing and homogenizing national cultural traditions, and of creatively destructing industries and national economies. However, most attempts to alleviate the business impact on the sustainable development of our planet involve at least some sort of business participation.

What is the concept of ‘sustainable development’? Why has it recently increasingly morphed into ‘sustainability.’ What does it mean for business and politics?

The concept ‘sustainable development’ is a highly contested one; it could be considered what Gallie (Proc Aristot Soc 56:167–198, 1955–1956) once referred to as an ‘essentially contested concept’ whose application is inherently a matter of dispute. The subtle shift to ‘sustainability’ is part of that contestation—and should be recognised as such. Failure to recognise this is to seriously diminish the potential of the concept to achieve the hopes held for it.

Some would argue that is no bad thing. I have variously heard sustainable development described as an oxymoron, or as ‘just words’. But words and their meanings are important—fundamentally important—to addressing public policy problems. We cannot devise laws or public policies unless we can define what it is we are doing. Yet developing shared understandings of problems, while not all the story of gaining political support, then is at least much of it, and the very vagueness which limits policy effectiveness can help with policy adoption—and therein lies a dilemma.

A quarter of a century has now passed since Gro Harlem Brundtland produced her landmark report on sustainable development, yet little progress has been made towards achieving the kinds of policy reform that might result in sustainable development being realised – especially in the humanistic rather than technocratic manner that she advocated.

The Brundtland Report suggested the only political strategy imaginable given the nature of the international system at the time: the pursuit of sustainability was essentially a matter to be decided by sovereign national governments (World Commission on Environment and Development, Our common future. UN, New York, 1987). Since its problems transcended all national borders, their resolution required intergovernmental agreements that were global in scope and the United Nations offered the only framework for conducting such negotiations. Once member governments had signed the relevant treaties, they would ratify and faithfully execute them – with supplementary assistance from new and/or pre-existing UN specialized agencies. None of these assumptions was completely wrong, but we now know, after two decades of highly visible global conferences, multiple international declarations of good intention, and several intergovernmental treaties, that they collectively turned out to be insufficient. The world is not more sustainable than it was – quite the contrary – and it is hard to discern whether all of these efforts have made any appreciable positive difference. Brundtland was innovative in its analysis of problems, but conventional in its political strategy for solving them.

In recent decades new interesting efforts have been made in global consumer policy, and certain advances have been made to endow the consumers with more rights and provide better information. This should give consumers a stronger position and thus sustain key functions of markets. According to the United Nations Guidelines for Consumer Protection, governments are attributed a crucial responsibility, but in addition, “all enterprises should obey the relevant laws and regulations of the countries in which they do business. They should also conform to the appropriate provisions of international standards for consumer protection to which the competent authorities of the country in question have agreed” (United Nations, United Nations guidelines for consumer protection (as expanded in 1999). UN Department of Economic and Social Affairs United Nations, New York, 2003). This chapter explores different initiatives in the global business community.

An increasing number of sustainability problems involve the risks of transnational High Impact Low Probability (HILP) events. The Centre for Risk Studies at the University of Cambridge has usefully identified 12 categories of HILP events, which they label “macro-threats”: financial shock, trade disputes, geopolitical conflict, political violence, natural catastrophe, climatic catastrophe, environmental catastrophe, technological catastrophe, disease outbreak, humanitarian crisis, externality (such as an asteroid hitting earth) and an “other” category (Coburn et al. A taxonomy of threats for macro-catastrophe risk management. Draft of Working Paper 201307.20, Centre for Risk Studies, University of Cambridge. www.​risk.​jbs.​cam.​ac.​uk. Accessed 30 Nov 2013, 2013). These risks are especially difficult to measure since the HILP events may have occurred very rarely, if at all. They are very difficult to manage since there is a tendency to postpone making costly investments now when these are intended to address uncertain future events, even if these future events will be catastrophic if they occur. All these profoundly involve sustainability, and in a distinctively challenging manner, since ongoing or frequently occurring reminders of threats to sustainability may not be sufficiently present to motivate responses. The severity and complexity of HILP events mean they usually affect all four types of sustainability discussed in the introduction to this volume: environmental, economic, social and cultural. HILP events are typically not restricted to any particular country, and thus have a transnational character (Lee et al. Preparing for high-impact, low-probability events: lessons from Eyjafjallajökull. A Chatham House Report. http://​www.​chathamhouse.​org/​publications/​papers/​view/​181179. Accessed 1 Dec 2013, 2012).

This chapter is concerned with an issue of central importance to environmental sustainability. Plant protection products are necessary to ensure security of food supply, but as toxic substances they also pose a series of potential challenges to the environment, including water pollution and possible threats to human and animal health and hence to biodiversity. This is why they are heavily regulated.

Conventional synthetic products are becoming less available and less popular. Many older products have been withdrawn for regulatory or commercial reasons. Others become subject to heritable resistance. The rate at which new, safer chemicals are being made available is very low. This is caused by a fall in the discovery rate of new active molecules and the increasing costs of registration. This creates a need for the use of alternative products as part of a more general Integrated Pest Management (IPM) strategy. Biopesticides are not necessarily substitutes for synthetic pesticides and are often used alongside synthetics as complementary products.

A common view of business in political science and sociology is that capital owners, managers, firms and their associations are only short-term profit-seekers. If this were true, business “as such” would have fought against social and environmental policies at all times and in all places. In fact, business contributed to many long-term problem-solving processes with respect to social and environmental issues. Most of these ecological approaches are currently subsumed under the concept of sustainability, and one of the most important strategies in this respect is energy saving. Since our world’s energy resources are limited and the usage of many energy forms implies some severe long-term negative externalities (e.g. global warming or radio activity), energy saving is one of the key strategies that contribute to sustainable social and economic development. In this chapter, we study a special area of energy saving and energy efficiency improvement, that is, the reduction of electricity consumption in private households. With respect to the numbers and types of policy measures designed to reduce energy consumption, there is large variation between countries. Many countries apply regulatory measures (voluntary or mandatory norms and standards with respect to energy efficient appliances), labelling programs, information campaigns, and counselling activities. We focus on product standards and environmental labelling. Both types of policy instruments are well established measures in helping reduce energy consuption.

The Twenty-first Century has presented us with an odd paradox: the forces of technology, and most especially the digital revolution, have been providing us with increasingly individualized entertainment options, while the forces of the economy have tended to reduce those options and to homogenize them, homogenizing cultures in the process. Under the guise of increasing individual choice, the diversity of the world’s varied cultures is under threat.

Cultural diversity is a value in itself and a collective good. It is only natural that people wish to preserve the connections to their collective pasts and identities. This wish to maintain a sense of community is both particular and universal. Indeed, we all benefit from the preservation of cultural diversity: encountering folkways other than our own exposes us to different ways of thinking and can lead to new, occasionally profitable ideas. We are, at the very least, enriched. Can the world’s cultural diversity be protected? Can it be sustained?

Since the end of the 1990s, many companies have been getting explicitly involved in promoting good governance. The oil and mining sector is very prolific in this regard with at least three of the largest mining and oil companies having programs to promote public accountability at the international, national or local level. Initiatives to foster transparency, citizen participation or the strengthening of government capacities in which companies play an important role multiply. Why are for-profit organizations, whose aim is to extract natural resources and make profit, willing to invest time and money in promoting governance? Which factors allow for some companies to get more involved than others? The present chapter intends to answer this question. Based on a case study in Colombia and more than 40 interviews with companies’ employees, public servants and societal leaders, I analyze the motivations, interests and values that led an extractive company to engage in these types of initiatives.

The chapters in this edited book investigated how business deals with different issues of sustainability. The aim of achieving sustainability seems to be widely accepted. This chapter provides a comparative assessment of the previous empirical chapters and relates their empirical findings to the propositions put forth by Schmitter as well as the motivations of business to join the collective action and self regulatory regimes which were scrutinised in the introductory chapter. The argument proceeds as follows. The next section describes the dimensions of sustainability that were analysed in the empirical chapters. Then, the different forms of business participation are compared. The final section provides a comparative assessment of enabling factors which either nudge or enforce business participation in sustainability policies.