Nothing new about sustainability - Sustainability column

258
-1

Published on

AEGON sustainability experts discuss the long history of corporate social sustainability in society.

Published in: Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total Views
258
On Slideshare
0
From Embeds
0
Number of Embeds
0
Actions
Shares
0
Downloads
1
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Nothing new about sustainability - Sustainability column

  1. 1. Sustainability column for LinkNothing new under the sun‘Sustainability’ existed in the ancient world and in the old Dutch Republic – even in 21stcentury corporations, enlightened self-interest is alive and well.It may seem surprising, but sustainability – or corporate social responsibility – is notreally a new idea. It‟s existed in one form or another for hundreds, if not thousands, ofyears. In ancient Mesopotamia, there were laws against „negligent‟ builders, innkeepersand farmers. Four hundred years ago, shareholders in the Netherlands were alreadyprotesting against excessive executive pay. And in Britain, in the 19 th century, corporatepaternalists, like the Cadbury family, were providing workers with homes, education andhealthcare.These were, by and large, businesses and individuals acting to protect their owninterests – and, despite all the various theories and philosophies about „triple bottomline‟ and „shared value‟ – that‟s still the case today.Social and political changeThe modern sustainability movement got its real break in the 1960s and 1970s. Thesewere decades of profound social and political change – and, importantly, a growingenvironmental awareness. Organizations like Green Peace and Friends of the Earthbecame more influential, while in the United States Rachel Carson‟s book „Silent Spring‟shattered preconceptions about modern farming techniques and the use of pesticidesand fertilizers.Increasingly, companies were being held to account for what they did and the impactthey had both on the environment and society as a whole. When companies fouled up –as Union Carbide did at Bhopal in India in 1984 – there were serious consequences,both for the company‟s finances and for its reputation. For the first time, big corporationswere being challenged. Pressure was growing on businesses to think of more than justthe bottom line. Gradually, corporate social responsibility was expanded to includecustomer service, human rights, executive pay and fair trade – as well as theenvironment.Friedman’s maximNot everyone bought this argument, of course. For some, the purpose of a privatecompany was to make money for its shareholders – and nothing more. In 1962, theeconomist Milton Friedman came up with his famous maxim: “the business of businessis business”. Friedman‟s idea was that businesses had no legitimacy or interest ingetting involved in wider social issues.
  2. 2. This argument still rumbles on, but Friedman‟s maxim is not as far from modern-daynotions of corporate social responsibility as it first appears. These days, companies thatlook beyond the short-term bottom line do so not out of altruism but because theybelieve it will reduce risk and improve performance.Businesses have begun to talk about the „triple bottom line‟ – people, planet and profits.Leaders in the field – like Unilever and General Electric – argue that there‟s money insustainability. After all, happier employees means higher productivity and bettercustomer service. Lower energy consumption brings down costs and is good for theenvironment. And the better you treat your customers, employees, business partnersand other stakeholders, the better your reputation, the stronger your brand and themore likely you are to sell your products and services. In the United Kingdom, retailerMarks & Spencer says its sustainability program made it an extra GBP 50 million lastyear. Meanwhile, companies like Akzo Nobel and Philips are deriving an increasingshare of their revenues from „eco-premium‟ products like environmentally friendly paintsor energy-saving appliances.For such companies, the lesson is: sustainability pays – just as it did more than ahundred years ago for the Cadbury family and their workers. And if society as a wholebenefits at the same time, well, all the better.--------------------------------------------------------------------------------------------------The views and opinions expressed in this document are solely those of theauthor and do not necessarily represent those of AEGON N.V. Thisdocument is for information purposes only and any reliance you place onsuch information is strictly at your own risk. AEGON N.V., its affiliates andthe author cannot be held responsible for the accuracy or reliability of thecontents of this document.

×