Companies Leaning In and Leaning Out of Sustainability Commitments
A Delayed Impact Brief
Welcome to the May edition of The Impact Brief, your go-to source for the latest insights at the nexus of business and sustainability. In this edition, the leaning-out effect to the ever-evolving landscape of sustainable business practices and frameworks. The overarching theme over the past month has been the continuous realization that our planet is heating up, our oceans absorbing heat more rapidly then ever imagine, and the fact that we are already on the irreversible path. So what now? Action.
As it becomes clearer - if not startlingly obvious - that immediate and decisive action on climate change is necessary if we are to make even a dent in climate change. Although many startups are devising new ways to solve our global challenges, and some companies are developing deeper commitment to expanding their efforts across their companies, many companies are choosing to quietly lean out their commitments - extending them further into the future, stepping out of some, or fully leaning out of the public eye. This trend is particularly notable in the fashion industry, with companies such as Crocs, Hermes, and Asos reducing or fully stepping out of their previous commitments. It begs the question: Are they acknowledging the immense challenges that lie ahead, or are they simply daunted by the costs associated with full commitment? Across the extractive industries, we are seeing actors playing a dangerous game of choosing profits over action, such as BP, Shell, and Exxon all pulling back on their ambitious climate commitments. Other industries from insurance to funds. This alarming trend raises concerns about the industry's willingness to prioritize environmental responsibility in the face of mounting climate challenges.
But perhaps this is a bigger trend for all of recognizing the immense size of the challenge(s) ahead of us. While we may have good intentions the realities of what it will truly take, becomes a little less convenient. And we see this not only in corporate environments but consistently in populations around the western world in particular. When action trumps our lifestyles - the climate loses out.
Disclosures, Frameworks, and Certifications
Disclosures, certifications, and frameworks on climate change are crucial for businesses to adapt for the future if used. They provide transparency, credibility, and effective communication of climate-related risks and strategies to stakeholders. These tools help businesses assess and manage climate risks, fostering resilience in the face of changing environmental conditions, and adapting to the needs of the market and community, promoting accountability and driving positive change.
Overall, these mechanisms play a vital role in ensuring businesses are well-equipped to address the challenges and opportunities presented by climate change. BUT they are also ever-evolving and complex. It is crucial for businesses to stay attentive to emerging trends and best practices. Failing to stay informed and up-to-date on these developments may result in being left behind, missing out on opportunities and falling short of stakeholder expectations in an increasingly climate-conscious business landscape. And worse, your own growth. Below are critical developments in disclosures and frameworks.
B Labs New Standards
First Science-Based Targets for Nature
Comparability Needed in Company Climate Disclosures
EPA Proposes New Standards for Fossil Fuel Companies
Major News from Around the World of Sustainability
MSCI releases its May 2023 corporate tracker of the period progress by the world's listed companies towards net zero and curbing climate change risk. Lets just say time is running out, yet corporate progress is slow at best. Explore the tracker and download the most recent report.
Be Informed
Reading beyond strategy - We highly recommend the newly released Green European Journal collection of essays and articles, with a major theme of 'degrowth' covering topics such as biocapacity, a vision for a well-being economy, doughnut economics and much more. We promise you will find inspiring ideas, examples and discussions of the many faces of a positive postgrowth future, one in which people and nature can thrive together.
Funding Impact
Big congrats to the global investing newsletter CTVC raise to go beyond the inbox!
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