Every year, I look for important themes in sustainability that will have lasting impact on society, from glaring evidence of global megatrends to inspiring stories of corporate action. The year 2018 brought extreme change — in weather and environmental ecosystems, in political winds and power, and in the expectations of business. It also brought incredible clarity about the scale of our challenges and opportunities.
So let’s start with the big picture before moving to some corporate success stories.
The world’s scientists sound a final alarm on climate
We have about 12 years left. That’s the clear message from a monumental study from the Intergovernmental Panel on Climate Change (IPCC). To avoid some of the most devastating impacts of climate change, the world must slash carbon emissions by 45% by 2030, and completely decarbonize by 2050 (while, in the meantime, emissions are still rising).
The IPCC looked at the difference between the world “only” warming two degrees Celsius (3.8°F) — the agreed upon goal at global climate summits in Copenhagen and Paris — or holding warming to just 1.5 degrees. Even the latter, they say, will require a monumental effort “unprecedented in terms of scale.” We face serious problems either way, but every half degree matters a great deal in human, planetary, and economic losses.
It wasn’t just the IPCC that told a stark story. Thirteen U.S. government agencies issued the U.S. National Climate Assessment, which concluded that climate change could knock at least 10% off of GDP. Other studies tell us that sea level rise is going to be worse than we thought, Antarctica is melting three times faster than a decade ago, and Greenland is losing ice quickly as well. If both those ice sheets go, sea level rise could reach 200-plus feet, resulting in utter devastation, including the loss of the entire Atlantic seaboard (Boston, New York, D.C., etc.), all of Florida, London, Stockholm, Denmark, Paraguay, and land now inhabited by more than 1 billion Asians).
All of this suggests that business must dramatically change how it operates: companies will need to push well past their comfort zones from areas like politics and policy to engaging consumers to how they make investment decisions.
Entire towns are wiped off the map by extreme weather
This year the weather devastation around the world got, in the words of one colleague, “biblical.” The town of Paradise, California, was effectively eliminated by wildfires (that, yes, are made worse by climate change), killing at least 85 people. Most houses in Mexico Beach, Florida, were destroyed by Hurricane Michael. Unprecedented rains and damage from Hurricane Florence slammed North Carolina and temporarily turned a major highway into a river. Typhoon Mangkhut ravaged the Philippines and parts of China, killing dozens of people. Incredible heat blanketed four continents this summer, with records falling across Europe and Asia. Venezuela’s last glacier is disappearing. Finally, Capetown, South Africa, is essentially out of water due in part to drought — the city nearly shut off all the taps this year, but has held off “Day Zero” through ongoing restrictions and aggressive citizen action.
The consequences of these extremes are not theoretical. What is the economic cost to an area with no water, or one that’s under water, or burned to the ground? In the U.S. alone, it was $306 billion in 2017, shattering records.
Coral is dying, insects are disappearing, and the fate of major ecosystems looks dim
The world’s top coral expert confirms that at 2 degrees of warming, all coral will die. This will destroy a critical part of an ocean system that provides protein to hundreds of millions of people, helps blunt coastal storm surges, and supports the livelihoods of people working in fishing and tourism.
And it’s not just coral: there’s the death of pacific kelp forests, radical declines in insect populations, and continuing population drops in all mammals and bees.
How does this all connect to business? For some sectors, it’s obvious: the food and agriculture industry will have trouble feeding us without pollinators, and tourism takes a big hit without coral and other wildlife. But more broadly, society will not thrive in a world where entire pillars of planetary support are collapsing. And if society can’t thrive, neither can business.
The U.S. environmental protection system continues being dismantled … from within
The EPA and Department of Interior are reversing years of protections for air, water, and land. In 2018, the Trump administration has opened up offshore waters and rolled back safety rules for drilling, greatly weakened the voice of science in policy, reduced focus on children’s health, and moved to make it easier to build dirty coal plants.
The big question now is whether businesses will push back and go down a cleaner path on their own. It’s easy to see why multinationals might as they face pressure from sub-national regions — California Gov. Jerry Brown held a Global Climate Action Summit which produced many aggressive climate goes from cities and state, for example. Gov. Brown also signed aggressive new laws committing to carbon-free electricity statewide by 2045 and requiring solar on all new homes. So even if U.S. action sputters, governors and mayors who influence local and regional business conditions will be pushing the clean economy and pro-climate agendas.
In pointed contrast to the U.S., the EU backed a proposal to strike no new trade deals with countries not in the Paris climate accord (i.e., only the U.S.), France will shut coal plants by 2021, India just cancelled plans for big coal plants, and China banned 500 inefficient models of cars.
A prominent leader retires, but new leaders step up
For nearly a decade, no business leader has done more to bring sustainability into the business mainstream than Paul Polman, Unilever’s outgoing CEO (Full disclosure: I’ve worked with Unilever). His depth of understanding of our biggest global, social, and environmental challenges, and his commitment to use business as a way to tackle them, has been unparalleled. But it wasn’t just talk. The company also grew throughout Polman’s tenure and the stock outperformed peers and the FTSE index. Luckily, there are other corporate leaders who are stepping up, including Danone’s Emmanuel Faber (see below for more).
But climate isn’t the only area where we’re seeing bold stances. Societal issues more broadly made headlines, too. The New York Times declared 2018 year that “CEO activism has become the new normal,” with prominent voices like Salesforce’s Marc Benioff leading the way. Other notable moments include Nike making Colin Kaepernick — the man who led NFL player protests about police violence against African Americans — the face of its 30th anniversary “Just Do It” campaign (sales rose quickly). Under pressure from survivors of school mass shootings, dikk’s Sporting Goods stopped selling assault weapons, and other companies cut ties to the powerful National Rifle Association. Kroger celebrated a year of its “End Hunger” initiative. Unilever threatened to pull its substantial ad dollars from Facebook and Google if they didn’t police “fake news and toxic content.” One hundred U.S. CEOs urged action on controversial immigration issues. And more than 100 U.S. companies gave employees time off to vote.
Danone becomes the world’s largest B Corporation
A “B Corp” certification requires answering an intensive set of questions on environmental, social, and governance issues. But most importantly, it commits a company to create value for all stakeholders (customers, employees, communities, and so on), not just shareholders.
French consumer products giant Danone has now put 30% of its brands and businesses through the certification process and says that “companies are fundamentally challenged as to whose interests they really serve.” Becoming a B Corp is arguably is a direct statement about whose interests it values most, and it’s and fascinating frontal attack on the dominance of shareholder capitalism.
because by the time we hit 2030 or so shyt will get ugly.
Well, its been real... cacs got what they wanted which was hell on earth..
that's fukking bullshyt
if it said around 2100, OK. or maybe this is just to drum up urgency
you should get used to that fact. sorry breh
just keep your head down when it all jumps off... we all feel it in our bones the end is coming, we all can feel something big heading our way...