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Overselling Sustainability Reporting - Coggle Diagram
Overselling Sustainability Reporting
Not measuring up
Temberland
committed to marring commerce with a philosophy of justice
printing "Green Index" scores on its shoeboxes inform consumers about product's environmental and social impact
Timberland stopped labeling shoeboxes with Green Index scores because of the challenges in calculating them .
reporting does not ensure environmental and social improvement
it's as if a person committed to a diet and fanatically started counting calories, but continued to eat the same number of cheeseburgers.
It's all growth, growth, growth-- and that's what's destroying the planet.
The Problems with Reporting
Lack of mandates and auditing
The reports , a minority of them are validated by third parties.
Specious targets
less than 1%, they integrated environmental goals that align with expert's understanding of planetary boundaries.
most companies set goals based on their capabilities or aspirations
Opaque supply chains
Decisions made to chase low-cost labor have led to highly distributed supply chains
Today at least 85% of the brand's production is overseas
that's made traceability problematic
Complexity.
Advances in technology (artificial intelligence, satellites, sensors, blockchain, and so forth) have given companies new tools for measuring and monitoring their environmental impact
Confusing information
Patagonia
Patagonia's statement that making one of its fleece jackets generates 20 pounds of CO2
consumers have no intuitive reference point that helps them understand many measures of environmental impact
Inattention to developing countries.
greatest increases in consumption, emissions, and social impacts in the coming decades will occur in China, India, and Africa.
companies in those markets will need to become far more efficient managers of resources, with stronger governance structures.
The problems with sustainable investing
Unhelpful definitions of "sustainable
Unreliable ratings.
The profusion of standard setters, raters, and data has had the opposite of its intended effect.
increasing transparency can produce a flood of unsorted information and misinformation that provides little but confusion
Lack of comparability
It is sometimes difficult even to compare the performance of a single company from year to year because of changes in methodology or decisions to use different metrics or standards to measure the same thing.
Challenges in assessing the success of socially responsible investing
if one of the goals of socially responsible investing is to deliver positive social and environmental outcomes, how do we know if that investing is working?
A recent study found little evidence that it is
Difficulty of scaling up truly effective impact investing.
Because company announce, address social and environmental issues without negatively affecting market returns.
Where to focus
The biggest danger is not inaction. The real danger is when politicians and CEOs are making it look like real action is happening when in fact almost nothing is being done
Measure less, better.
No matter what standard ultimately prevails, sustainability reports must be mandated and audited by an empowered referee.
Mobilize
grassroots global movements for action -- such as the Sunrise Movement and 350.org -- are making what the civil rights
Spend government funds on the right things.
sing taxpayer money to subsidize energy sources that accelerate future environmental damage.
if governments instead invested those resources in R&D for carbon capture, incentives for retrofitting buildings, or infrastructure to spur faster growth in renewable energy.
Change the system
If their behavior is to change, the rules that governments set and enforce also need to change
Idea in brief
The hope
Companies would do less harm to the planet and more good for society Investors and consumers would reward strong performers.
The reality
Reporting is riddled with problems, and sustainable investing is overhyped.
A better approach
we also need stronger civic engagement, sharper regulation, different incentives for investment, and a rethinking of what makes a company or society successful.