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Private sector gets serious about a sustainable future

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CDR SPECIAL REPORT — Since the beginning of the COVID-19 pandemic, the momentum behind the sustainability movement has slowed somewhat, with the attention of government officials, activists and average citizens dominated by the immediate crisis and the concurrent drive for racial justice. The climate emergency has not, however, abated, a reality brought home to Americans by an unusually active hurricane season in the Atlantic Basin, the derecho in the Midwest and raging wildfires in the western U.S.

At the time this special report about the efforts of the retailing and CPG industries to address environmental issues went to press, more than 100 fires were burning in the West. In California, the hardest hit state, over 3 million acres of land had been burned; countless structures, in some cases comprising entire communities, were destroyed; and the air in places like San Francisco took on an apocalyptic orange glow from sunlight interacting with high concentrations of smoke and ash. Oregon, Washington and other states were also hit hard.

Anyone who might be tempted to dismiss such phenomena as aberrations would do well to read a new report compiled by the World Meteorological Organization under the direction of U.N. Secretary-General Antonio Guterres. It concludes that the concentration of greenhouse gases in the atmosphere is at an all-time high, emissions are returning to levels seen before the emergence of COVID-19, and that the planet is on course to register the warmest five years ever recorded. Unless forceful action is taken, the goal, established in the 2016 Paris Climate Agreement, of keeping the global temperature increase below 2 degrees Celsius will not be attained.

“The heating of our planet and climate disruption have continued apace,” Guterres says. “Record heat, ice loss, wildfires, floods and droughts continue to worsen, affecting communities, nations and economies around the world. Furthermore, due to the amount of greenhouse gases emitted in the past century, the planet is already locked into future significant heating.”

The consequences of that trend, which are already abundant, include an adverse impact on the economy. A study from a subcommittee of the federal government Community Futures Trading Commission issued on the same day as the U.N. report included a stark warning about the economic fallout from climate change: “Climate change poses a major risk to the stability of the U.S. financial system and to its ability to sustain the American economy. Climate change is already impacting or is anticipated to impact nearly every facet of the economy … Over time, if significant action is not taken to check rising global average temperatures, climate change impacts could impair the productive capacity of the economy and undermine its ability to generate employment, income and opportunity.”

The response by political leaders has been uneven at best. While some jurisdictions are implementing programs designed to help alleviate the crisis, others, including the federal government, which under President Trump’s direction dropped out of the Paris climate accord, are all but ignoring the problem.

In the absence of a consistent commitment by government, the business sector has stepped up to help fill the void. As the stories on the pages that follow demonstrate, many companies in this country and abroad are focused on doing everything they can to make the planet healthier and, in the process, improve the lives of ­stakeholders.

Walgreens Boots Alliance chairman James Skinner and vice chairman and chief executive officer Stefano Pessina summarized the thinking of many business leaders in the company’s latest corporate social responsibility report. “Through operating a sustainable enterprise and responding to social and environmental needs, we believe we are creating long-term value for our investors, our customers and patients, our valued employees and for society at large,” they wrote. And, by doing the right thing on sustainability and other societal issues, they are also strengthening their ­organization.

Companies that act as responsible stewards of the environment are being rewarded. An increasing number of consumers and Wall Street investors are gravitating toward businesses that are serious about their commitment to sustainability and the communities they serve. Larry Fink, chairman and CEO of investment management firm BlackRock, made news earlier this year when he announced that going forward the company would link investment decisions to sustainability policies. “A company cannot achieve long-term profits without embracing purpose and considering the needs of a broad range of stakeholders,” he wrote. … “Actions that damage society will catch up with a company and destroy shareholder value.”

The companies whose sustainability practices are profiled on the following pages understand that dynamic. The editors of Chain Drug Review, who were planning an industry summit on environmental issues when COVID-19 struck, salute their efforts and those of countless other companies in the retailing and CPG industries.

 


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