GLOBE 2000 delegates confirm that embracing the environment makes sound business sense

Tuesday, 01 August 2000

At GLOBE 2000 in March, leaders in the international business community hinted at a changed world, and issued a wake-up call to companies and governments that still feel they must choose between economy and environment. Corporate leaders explored the interaction between business and the environment, recognizing that this connection is now tangible, and competitive advantage will be lost if the environment is not a key component of business strategy. Three main issues were highlighted at GLOBE 2000 – environmental performance is critical to business success, partnerships between business and government are crucial, and finally, business must join the fight against global climate change.

Environmental performance is critical to successful corporate performance

The connection between business and the environment, once a theoretical concept, is now being engrained as a fundamental factor shaping business practice. “Today, environmental performance is a pivotal strategic issue – appropriate corporate action strengthens market share, improves productivity, increases share value and mitigates risk – no company can afford to overlook these realities,” said Wayne Soper, Vice President of Environment and Government Relations at Westcoast Energy, a North American natural gas and energy company with headquarters in Vancouver. Sessions at GLOBE 2000 focussed on the new face of environmental business – combining sustainability with sound business practice. World environment and business leaders came together to discuss the negative influence business practices often have on the environment, and to examine leading solutions to reduce this impact. Said Jay Taylor, of Placer Dome, a Canadian-based mining company with international operations, “Our sustainability policy represents the beginning of a new thrust towards establishing a competitive edge in aspects of our business that we, and a growing percentage of the modern world, value”.

Competitive advantage, not regulatory pressure, is now forcing a move towards sustainability in business practice. The old style of environmental management – reaction to immediate crises without concern for long term costs and consequences– must give way to treatment of economy and environment, “not as concurrent or complementary priorities, but as integral parts of a whole,” said the Honourable David Anderson, Canadian Minister of the Environment. Environmental responsibility is now recognized as being compatible with success and effectiveness in business, and those companies that embrace environmental practices as part of their business plans will benefit from this connection.

The measure of this success and effectiveness is “the triple bottom line”, which accounts for economic, environmental and social considerations in corporate performance. This new solution to public demands for corporate accountability has gained widespread recognition in the international business arena, and these principles have been adopted by a number of major companies. Old methods of reporting are increasingly seen as insufficient, and stakeholders are looking for corporate commitment to sustainable development and a clear environmental position. This new reporting method will make information readily available to all stakeholders, and will reward positive corporate environmental performance by improving credibility and public image.
ISO 14001 and associated environmental management systems (EMS) were discussed at GLOBE 2000 as key components for managing environmental performance under the triple bottom line. EMS’s consolidate information into one area, making it accessible to managers, and allowing for prompt reporting to shareholders, employees, and the general public. Those companies with EMS’s therefore achieve a competitive advantage over those without such systems. There is a strong relationship between environmental performance and competitive edge, and EMS’s allow for a measurement of this performance, acting to improve a company’s credibility and market share.

Partnerships are key to sustainability

“Partnerships are key to meeting the challenge of developing practices that are both environmentally and economically sustainable,” said Minister Anderson. These partnerships can occur between business partners, or between business and government, to quickly achieve mutual goals. Work has only just begun to ensure these partnership goals can be translated into actions and results.
Rapid urbanization has presented a challenge in developed countries, and has become a formidable problem in developing countries. Preservation of environmental quality in areas with high local population growth was the primary focus of a session entitled “Sustainable Cities: Tailoring Solutions to Local Needs”, which featured Juan Rodrigo Walsh, Undersecretary to the Environment for the City of Buenos Aires. Non-governmental organizations, government, and private companies must work together to find creative solutions, build better urban environments, improve citizens’ quality of life, and respect the physical environment. Mr. Walsh addressed the need for sustainable city initiatives that encompass city governance and administration, including land use, city planning, and design elements specific to the needs of the people of Buenos Aires. Sustainable practices must also be implemented within City functions and residents must be encouraged to incorporate environmental considerations into their own activities. Stronger relationships between public and private sectors and the governments of South American countries were applauded by Ambassador Elsa Kelly, Special Envoy for the Environment, Ministry for External Affairs and Foreign Trade, Government of Argentina. She spoke during the International Ministerial Armchair Dialogue on Climate Change, and was pleased that the government of Argentina has given the private sector the legal framework to work in a positive way for the environment. This will effectively advance the situation for environmental controls and initiatives like the Clean Development Mechanism under the Kyoto Protocol.

Business is getting serious about climate change

Voluntary commitments made by business show that market force is now stronger than regulation, and international response to climate change is expected to be the most powerful influence upon future corporate performance. Companies now recognize they must take a leadership role in mitigation of climate change effects, by meeting current voluntary commitments, complying with future policy, and incorporating technological initiatives into general business practices. This will contribute to reducing effects of climate change, and will also give participating companies a competitive advantage in the global marketplace. GLOBE 2000 speakers are at the leading edge of international business, and their talks suggested a shift in attitudes toward addressing climate change. Characterizing climate change as a government problem, or even denial of its existence, has given way to an understanding that this is a major concern on the global business front. Industry now wants to deal with the problem, and some see it as a solid business opportunity. Companies with business policies focussed on reduction of greenhouse gas emissions will also enjoy increased credibility with the general public and shareholders.

Climate change represents an opportunity primarily in emission credit programs, and development of new technology. Governments, policy research organizations, and industry in a number of countries are developing and implementing systems for domestic greenhouse gas emission credits. New and innovative technologies that reduce global carbon emissions through efficiency enhancements and leveraging of alternative energy solutions are necessary to meet Kyoto greenhouse gas emission targets. For example, the Building Integrated Photovoltaics Demonstration Project of the British Columbia Institute of Technology generates electricity for buildings through solar energy, effectively reducing use of fossil fuels and subsequent greenhouse gas emissions. Canadian Environment Minister David Anderson announced sponsorship of the program at GLOBE 2000, forming a partnership between government and industry to develop new technologies to reduce climate change. “By working together, we are ensuring the development of environmentally friendly and energy efficient technologies resulting in sustained economic growth while protecting our environment,” said Minister Anderson. Companies that are adopting these technologies will act to reduce their contribution to climate change, eventually allowing nations to meet Kyoto targets.

Facilitation of technology transfer and capacity building between Annex 1 and developing countries for combating greenhouse gas emissions was a focus for Ambassador Kelly’s talk. She also spoke to the need for demonstration projects under Kyoto’s Clean Development Mechanism in South American countries. These pilot projects will use sets of rules and expectations on a provisional basis that will help overcome difficulties faced by all South American countries dealing with political roadblocks in implementing CDM and related projects. These provisional systems will allow countries like Argentina to experience how the regime will eventually work once it has been put in place for the long term.

GLOBE 2000 was the sixth biennial conference in a ten-year series on the business of environment. Approximately 10,000 representatives from the international business and environment community attended the event, with a number of international government representatives also participating and speaking at conference sessions. The concurrent trade fair was a showcase for companies, governmental organizations, and learning institutions that are leading the way with solutions to environmental problems.

Delegates attended from Europe, Asia, Africa, North, Central and South America. All countries of the Southern Cone were represented. The Argentinean contingent included a mix of government and industry representatives, including Guido Esteban Gariboldi and Ricardo Bach, of Decision Systems, Inc.; A. Carbajal, Director de Technologia, and Amalia Ruso, Subsecretaria de Ordenamiento, Ministerio de Desarrolo Social; Ines Carolina Piccinino, Licenciada, Secretaria de Industria; Eduardo Ricciuti, Inst. Nacional de Technologie; Juan Rodrigo Walsh, Undersecretary of Environment, City of Buenos Aires; and Ambassador Elsa Kelly, Special Envoy for the Environment, Ministry for External Affairs and International Trade.

About the author:

Shawna was a consultant with IndEco from 1999 to 2000. During her tenure, she worked on various projects related to regulatory approvals, and communication and training. For more information on these services, please contact Judy Simon.