There has been a rapid recent shift from Scope 3 emissions measurement and
management
as a “nice-to-have” to a requirement for doing business responsibly. If your
brand intends to lead in the markets of tomorrow, you must understand your
supply chain and be reducing impacts now. It is no longer tenable to not know
the environmental and social implications across the production lifecycle. With
disclosure regulations at
play across the globe, ESG
reporting is increasingly being legally mandated. Examples include the EU’s
recently adopted Corporate Sustainability Reporting
Directive,
the global International Sustainability Standards
Board;
and the SEC’s proposed ESG disclosure
mandate
in the US.
Government regulators are playing a key role in shaping how we address climate
change; however, influential businesses have a chance to ensure these
requirements speak to the metrics that make a true impact. Policy is a catalytic
vehicle for change. As a business community, we should be embracing it as a
means to address the existential threat of the climate crisis — to not do so
would be irresponsible and dangerous. Recognizing the tension in the system
among trade organizations, policymakers and corporations doesn’t mean it can’t
be done right. For businesses and brands, creating incentives around impact
reduction
that tie clearly to company goals is a key opportunity for transformative
action.
It’s no secret that multiple industries have reaped the rewards of a broken
economic model that relies on extractive and exploitative practices that
continue to harm people and the planet. Consumer goods is one of those
industries; and responsible leaders recognize it is time for a new system — one
that transforms design and consumption and imagines a new way of doing
profitable business. Over two-thirds of US consumers are willing to pay more
for sustainable
products.
Globally, that number is just over a
third
— though that number rises to 39 percent for Gen Z and 42 percent for
millennials. Capital markets will reward those that are de-risking their supply
chains; and employees want to work where purpose and responsibility
matters.
The argument that without perfect data we can’t do this work ignores the reality
that science is always evolving. We must move forward with urgency, using the
significant directional data that already exist and show where the key issues
and intervention opportunities lie. Taking accountability for the full product
lifecycle and impacts up and down the value chain is the only way to achieve
meaningful ESG performance. It’s not about marketing single environmental or
social attributes of a product. It’s not just reducing impact in owned
operations while ignoring the manufacturing impact or material inputs of the end
product. It’s believing that tomorrow’s customers will want (and deserve)
something different than they get today.
OK, Now What?: Navigating Corporate Sustainability After the US Presidential Election
Join us for a free webinar on Monday, December 9, at 1pm ET as Andrew Winston and leaders from the American Sustainable Business Council, Democracy Forward, ECOS and Guardian US share insights into how the shifting political and cultural environment may redefine the responsibilities and opportunities for companies committed to sustainability.
This is hard, complex work; it won’t be completed in my lifetime. But we must
move rapidly to accurately understand impact and take action with urgency. And
we must be ready to learn and change as we know more. The tools to begin this
work already exist. Smart businesses already see their futures. And while the
volatility of economic change around us can be distracting, one thing remains
clear: A new generation of expectations is shifting business for good.
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Published Mar 30, 2023 8am EDT / 5am PDT / 1pm BST / 2pm CEST