Ethical Performance
inside intelligence for responsible business


Big goals and a backlash: how 2011 might shape up

February 2011

Aron Cramer, president and CEO of Business for Social Responsibility, outlines the corporate responsibility trends he believes we should look out for this year  

Sustainability goals—the bigger the better
2010 ushered in the era of big global commitments by big global companies – and this will only expand in 2011. In the final quarter of 2010 alone, stalwarts such as Unilever, Procter & Gamble, Google, and Walmart all set audacious goals tied to massive resource efficiency, local sourcing, and innovation. What’s striking about this is how it represents a fundamental shift from just a few years ago, when companies were exceptionally timid about making public commitments. Those days are gone. Two key changes have occurred. First, sustainability has become a topic on the board’s agenda. Second, it is now more widely understood that sustainability can spark innovation that delivers a competitive advantage—it is not simply a risk mitigation exercise.

Rio+20 starts now
One way to think about 2011 is as an 18-month run-up to the Rio+20 summit in June 2012. The disappointment in Copenhagen at the end of 2009 reminds us not to expect a grand global agreement on sustainable development to come from Rio; global summits seldom deliver the goods in that way. Despite this, however, this next Earth Summit will be very significant. Companies, civil society, and governments will assess what’s been accomplished since the first Earth Summit nearly 20 years ago, and look for ways to accelerate progress.

It is very clear from my conversations with many companies that they are looking at the next Rio Summit as an opportunity to demonstrate business leadership, develop new collaborations, and to innovate in ways that achieve sustainable prosperity for all. And because the event is taking place in Brazil, this will be as much about economic development across the globe as about decarbonizing the economy.

Getting ready for Ruggie
John Ruggie, the United Nations special representative on business and human rights, is due to present his final recommendations to the Human Rights Council in June. This won’t close the book on his work, but rather usher in a shift away from Ruggie’s office at Harvard, where he and his team have toiled the past four years, to the field, where implementation happens. From now on, we’ll see Ruggie’s framework and guiding principles put into action in countless government agencies, companies, supply chains, communities, and partnerships. The framework will not have the formal force of law behind it, but will immediately be considered the de facto standard against which company actions are gauged by stakeholders. To implement that standard fully, most companies will need to broaden and deepen their approach to human rights.

Stakeholders strike back?
There are three reasons to think that an era of generally constructive stakeholder relations may be about to grow more turbulent. First is the existential question of what civil society’s purpose is. A growing number of NGOs who are alarmed at the increasing coziness between some of their civil society brethren and the world’s biggest businesses are questioning whether they are devoting too much time and attention to collaboration. Second, many NGOs question whether the era of co-operation is delivering the goods, and whether a more confrontational approach is needed to achieve their goals. The third factor is the rise of social media, which is undermining the monopoly NGOs have held in reflecting public opinion on global business. This environment suggests that some organizations—or online coalitions—will test the status quo by challenging big name companies in ways we’ve not yet seen.

Expect the unexpected
As always, humility is in order when making predictions. Former BP CEO Tony Hayward had a very different vision of 2010 than the one he experienced. There is little doubt that surprises will erupt. By definition, they cannot be predicted, but some candidates are more likely than others to emerge. It is a good bet that the kinds of challenges faced by governments from WikiLeaks in 2010 will also affect business in 2011. Privacy will continue to rise up the corporate responsibility agenda as the ‘internet of things’ grows in significance. Wild weather will remind all but the most steadfast sceptics that climate disruption has already arrived on the world’s agenda. And economies that are returning to health also mean that commodity prices will return to the upward climb that was temporarily halted by the recession, again making efficiency an imperative for consumers and business. All of these trends show just how central sustainability is to the business agenda.

Business for Social Responsibility | Global | CSR


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