This past February, professionals from the world’s most influential companies gathered in Phoenix to discuss the latest trends, challenges, and solutions in corporate sustainability, as part of the annual GreenBiz conference. While a hotel with five swimming pools and a lazy river in the middle of the desert may seem an odd place for path-breaking conversations on sustainability, the three-day conference yielded a wealth of ideas and connections. We attended the conference as student volunteers, and it was a fascinating look into the world of sustainability professionals—a world that we may soon join.
This year, we have heard from many such professionals through the Pathways in CSR series, which brought representatives across a range of companies to campus to discuss their work and professional journeys. The conference reinforced many of the themes that have arisen in that series, while also introducing us to new concepts and ways of thinking. Here are three key lessons that we learned:
The private sector is both supporting and leading global environmental action.
Many sessions at GreenBiz tapped into wider global conversations on sustainability. Attendees demonstrated that corporations are committed to global priorities and often lead the charge in realizing them. For instance, the United Nations Sustainable Development Goals (SDGs) were a frequent topic of discussion and the subject of a four-hour tutorial. The SDGs are a set of 17 goals and 169 targets that the world aims to meet by 2030. Many companies represented at GreenBiz align their sustainability strategies with the SDGs, using the global goals as a guide to set goals of their own. Companies also use the SDGs as a frame for communicating their activities to a global audience. By connecting to a global framework, businesses can integrate sustainability issues into their strategies that they otherwise might not have considered, and they can more easily coordinate with governments as well as other companies.
Companies are at the forefront of many SDGs, such as combating climate change, which is Goal 13. In 2017, global progress towards this goal encountered a setback when the US federal government announced that it would withdraw from the Paris Agreement. Yet soon after, businesses were among the first actors to step forward and reaffirm their dedication to climate action. Companies like Microsoft, Walmart, and L’Oreal have joined a network called We Are Still In, which emphasizes that along with state and city governments, they will do their part to uphold the US commitment under the Paris Agreement, even if their federal government withdraws. Many companies at GreenBiz have officially affirmed that they are still in, and that spirit of unrelenting climate leadership pervaded the conference.
Companies are striving for demonstrably meaningful results, not just lip service.
Given the wide range of actions businesses are taking to achieve sustainability, it is easy to frame small steps as large strides. However, many sessions at GreenBiz focused on setting ambitious goals and measuring impacts, so that businesses could demonstrate that their efforts were truly substantive. For instance, companies like Kellogg’s, Mars, and Caesars Entertainment are setting science-based targets for reducing their greenhouse gas emissions, under an initiative led by World Resources Institute and other civil society groups. These targets are tied to specific emissions budgets that will limit temperature rise to two degrees Celsius, the internationally agreed-upon limit. By setting science-based targets, companies ensure that they are pulling their weight in global climate change mitigation efforts.
Many science-based targets deal only with emissions that result from a company’s direct operations and energy use, but some companies are also considering how to reduce emissions broadly throughout their supply chains, where most emissions occur. Walmart has one of the world’s largest supply chains and it announced last year that it would work to reduce emissions across its supply chain by one billion metric tons of CO2e by 2030, through an initiative called Project Gigaton. The retailer provides tools and resources to its suppliers to support them in reaching this goal, and representatives from Walmart walked through some of these resources during a session at GreenBiz.
Investor demand has given new momentum to sustainability concerns.
One of the most popular breakout sessions at GreenBiz was about integrating environmental, social and governance (ESG) concerns into overall risk management. The event was standing room only, with almost every inch of space occupied. The tremendous popularity of this session reflects how sustainability has become a mainstream priority in corporate strategy and finance, moving from a “nice-to-have” to a “must-have.” The financial world has driven much of this change, as investors increasingly assess companies based on ESG performance. ESG information relates not only to social and environmental sustainability but also financial sustainability, as an ESG-aligned strategy helps companies to avoid risk and capture opportunities in the long run.
Even the biggest players in finance are taking this long-term perspective. The top executive at BlackRock, the world’s largest asset manager, recently sent a letter to CEOs saying that over time, any firm must make a positive contribution to society in order to succeed, and he suggested that companies must clearly outline their long-run strategies for BlackRock to invest in them. This kind of pressure from investors creates a powerful incentive to prioritize sustainability, and it is a relatively new trend. Yale has been at the cutting edge of research and innovation on this topic through the newly created Yale Initiative on Sustainable Finance.
After attending GreenBiz, it is clear to us that the future will hold ample opportunities for innovative, hard-working sustainability professionals to make change through work in the private sector. Though sustainability teams are relatively tiny at large corporations—a few dozen people out of thousands or even hundreds of thousands of employees—these teams tend to be constantly expanding their efforts and growing in number. There are also a range of other roles essential to corporate sustainability within these companies and also at related organizations, including consulting firms and non-profits. For the right people, such as the students who have been eagerly attending Pathways in CSR events, corporate sustainability is a promising route to a career with positive environmental impact.