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Sweden country briefing, Ethical Corporation 2011


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Sweden country briefing, Ethical Corporation 2011

  1. 1. Country briefing:Sweden55 Tackling social challenges61 A joint activist approach63 Do as government does TT/DREAMSTIME.COMOverviewQuietly confidentBy Astrid von Schmeling in StockholmWith a strong economy and global brands, Sweden is busy building a sustainable future he year is 2024. In the picturesque Royal Seaport “Sweden shows that good social and environ- Many SwedishT area of northern Stockholm, residents wake upto clean dishes, dried clothes and charged cars. The mental performance can underpin and support economic growth,” says Paul Begley, research multinationalsstreets bustle with activity as people hurry to their manager at AccountAbility. More recent indices were earlyvirtual meetings. The combined efforts of solar and concur – Transparency International rates Sweden adopters of thewind energy, cutting-edge architecture, electric cars fourth best in its global Corruption Perceptionsand appliances with machine-to-machine commu- Index, while Edelman’s Trust Index 2010 concludes sustainabilitynication enable these residents to produce 1.5 that companies headquartered in Sweden are agendatonnes of carbon per person annually, about 75% among the top three most trusted globally.less than 15 years before. It’s good for international reputation building. Back to 2011, and Royal Seaport is one of Exports are the lifeblood of Sweden’s GDP motored ,Europe’s largest construction sites. A joint initiative by vibrant automotive, electrical, chemical,between the city of Stockholm, academia and busi- telecoms, steel and paper industries led by globallynesses including ABB, Ericsson, Electrolux and recognised brands including Ikea, Ericsson, Elec-energy company Fortum, it is pioneering a smart- trolux, H&M, SCA, SKF, Volvo and Tetra Pak.grid system – a precondition for zero-carbon living. Future areas of focus include environmental tech- The goal: to build a fossil-fuel-free community nology: the Swedish government has earmarkedwith 10,000 residences and 30,000 workplaces by €420m for environmental projects over the next2030. It has the potential to showcase Sweden’s two years, including €129m to commercialise greeninnovation, IT and engineering excellence interna- technology.tionally. In a nutshell, Royal Seaport embodies Many Swedish multinationals were earlySweden’s vision of sustainability and the role of adopters of the sustainability agenda. The driverbusiness partnerships in achieving it. was not so much consumer demand as recognition of sustainability’s strategic potential in internationalRecognition business – and because the state demands it. LayingSweden is used to accolades for its sustainability out clear rules is something Swedish governmentperformance. In 2007, it topped AccountAbility’s does well.Responsible Competitiveness Index ahead of The Swedish way of tackling sustainability chal-Denmark, Finland, Iceland and the UK, for doing lenges is the systematic way. Swedish business hasthe most to advance business competitiveness a long-standing appetite for management systemsthrough responsible business practices. and standards and boasts the fourth highest
  2. 2. 54 Country briefing: Sweden Ethical Corporation ISO 14001 accreditation rate in the world – impres- let the parties cooperate without surrendering Sales of fair trade sive for a country with a population smaller than their own interests. By law, employee unions must Belgium’s. be represented on the board of every listed products increased Consumers are used to having their best interests company. 75% in 2009 alone looked after by the state. In a 2009 Globescan report, No country is perfect and the former leader of only 4% of Swedish consumers spontaneously the political opposition Mona Sahlin has noted that brought up climate change and environmental Sweden has the most highly educated taxi drivers issues as a top concern – well below Australians on the planet – alluding to the difficulties facing (22%) and Chinese (23%). those with non-Swedish names in finding appro- priate employment. It’s a recognised problem, yet Consumer challenges few Swedish companies can demonstrate they are They make up one of the most homogenous actively addressing it. markets in Europe; once products are accepted, Actions speak louder than words in a country widespread adoption is guaranteed. Take fair trade. where understatement is engrained. Swedes call it After a long struggle to break through, sales of fair “jäntelagen”, meaning “a code of conformity forbid- trade products increased 75% in 2009 alone. ding anyone to feel superior to their neighbours”. As a small country, corporate, political and In the corporate sustainability context the result cultural life is closely intertwined. Exchanges come is a focus on process and performance measurement Astrid von Schmeling, based naturally and informally and are typically and getting your house in order – a successful in Stockholm, specialises in consensus-driven. Swedes like to agree, so many approach for risk management. However, as sustainability strategy and don’t “get” stakeholder engagement – it seems sustainability ratings indices increasingly gauge communications. She is a redundant. companies on bold leadership and forward-looking former managing director Sweden’s open and ongoing dialogue between strategy, this traditional discretion could mark of the magazine Tomorrow: employers and unions is a case in point, designed to Swedish pioneers down. n Global Sustainable Business. Sweden corporate responsibility factsheet Ethical Corp survey results Socio-economic statistics Number of employees spending more than 50% Foreign sustainability leader most mentioned (n=20): Population: ....................9.1 million (2010) time on CR/sustainability team (n=20): GE GDP: ..............................€248bn (PPP 2009) Have over 10 employees 20% InterfaceFLOR GDP per capita: ..........€27,400 (PPP 2009) Human Development Index: ........0.885, Have 5-10 employees 15% ABB 9th out of 182 countries Have 2-4 employees 35% Have 1 employee 15% Guidelines and initiatives most used (n=20): Current leadership No response 15% Global Reporting Initiative Prime minister: ..............Fredrik Reinfeldt Type: ....................Constitutional monarchy Size of CR/sustainability budget (n=18): Global Compact Key trading partners: Have a budget over €30,000 72% Top three challenges and risks (n=20): Have a budget €20,000–€29,999 0% Top exports Top imports Have a budget €10,000–€19,999 11% Climate change Norway 10.6% Germany 17.9% Germany 10.2% Denmark 8.9% Have a budget €5,000–€9,999 6% Integrating sustainability into overall strategy UK 7.5% Norway 8.7% Have a budget €1,000–€4,999 11% Social and labour supply chain issues Have a budget under €1,000 0% References: Top three opportunities (n=20): • Socio-economic statistics obtained from Focus of CR/sustainability team (n=20, including three Energy efficiency recent publications from the CIA Factbook selections allowed to each survey respondent): Product innovation and the Human Development Index. Reporting 45% Developing Swedish green issue leadership • Guideline and standards statistics obtained Employee engagement and management 30% during November 2010 from official website Dealing with climate change 25% of each initiative. Guidelines and standards statistics: • Corporate responsibility data obtained from a GRI reports in 2010 73 Sweden sustainability leaders most mentioned (n=20): November 2010 Ethical Corporation survey. The Ikea DJSI Europe listing 3 small sample of this survey means that the results should be regarded as an indication of H&M Global Compact participants 109 trends in Sweden and not as scientific research. Electrolux UNPRI signatories 25
  3. 3. Ethical Corporation Country briefing: Sweden 55 OLASER/ISTOCKPHOTO.COMCorporate issuesThe human touchBy Andrea Spencer-CookeWhile Swedish companies are environmental leaders, the next challenge is to harness Swedishinnovation to tackle the global social and development aspects of sustainability y 2050, Sweden will have a sustainable and has taken recycling into new territory with its fiveB resource-efficient energy supply and no netemissions of greenhouse gases in the atmosphere. “reincarnated plastic” prototype Vac from the Sea vacuum cleaners, made from plastic harvested from The Swedish love affairs withIn a country where this is the government vision, five of the world’s marine environments. Using the innovation andbusiness is widely seen as the means to make it same core structure as the Electrolux Ultra Onehappen. Green model, these prototypes are intended to raise the environment This “can do” mentality has spawned a culture of awareness about the paradox of excessive plastic manifestinnovation: Sweden is a nation of technology opti- waste in the oceans and shortage of recycled plastic themselvesmists. Innovation and cutting-edge design are part on land.of the Scandinavian DNA. Among the notable in a thrivingindustry sectors are cleantech, information and An incubator for cleantech cleantech sectorcommunications technology (ICT), life sciences, Not surprisingly, the Swedish love affairs with inno-automotive and materials sciences. Healthcare and vation and the environment manifest themselves inforestry are also significant employers. a thriving cleantech sector. This Swedish emphasis on innovation was Both government and private venture capital arerecently showcased at the Shanghai World Expo behind this sector’s success. This year Swedish state2010. Here, the Swedish pavilion, conceived by pension fund AP7 – with about 100bn kronorsustainable engineering and design company (€10.7bn) under management – announced itsSweco, focused on three keywords – innovation, intention to triple investment in renewable energysustainability, and communication – and a single over the next two years to 3bn kronor (€320m), inunifying theme “Sweden – Spirit of Innovation”. anticipation of people switching to cleaner tech- With a strong tradition of functionality, nologies.simplicity and engineering, Swedish companies In September 2010, Stockholm – chosen as thehave embraced the challenge of innovating for the first Green Capital in Europe for its efforts on noiseenvironment. In terms of energy efficiency, for pollution, clean water, waste systems and urbanexample, industrial engineering company Atlas green areas – held Cleantech Venture Day. Organ-Copco was the first to offer certified “net zero ised by Kista Science City, Stockholm Innovation &energy consumption” compressors under its Growth and KIC InnoEnergy and billed as Scandi-Carbon Zero range. The built-in energy recovery navia’s largest cleantech investment event, it wassystem allows 100% of the electrical power input to intended to bring together investors and innova-be recovered in the form of hot water – useful for tors/entrepreneurs within the primarily small andwater-intensive industries such as the food and medium-sized enterprise-led cleantech sector.drink, pulp and paper or dairy sectors. Among the promising up-and-coming offerings Consumer goods giant Electrolux, meanwhile, were HiNation‘s mobile solar products for portable
  4. 4. 56 Country briefing: Sweden Ethical Corporation Sustainable fashion in Sweden – exploring the oxymoron By April Streeter weden’s reputation as a leader in design and sustainability promote this – in fact it’s company policy not to talk about its S means it’s no surprise the country is leading the way in sustainable fashion. “eco” philosophy. Swedes are good at implementing system-wide change. The The good name is for good reason. Sweden is home to the Swedish fashion industry is well positioned to combine great, Sustainable Fashion Academy (SFA), which has put more than 75 enduring design with the elements of sustainable fashion – fashion professionals, including from companies such as Ikea, sourcing, materials use, and brand positioning. H&M, and tiny labels such as Nudie Jeans, through the funda- One of the premier examples is the fast-growing DEM Collec- mentals of systematically integrating sustainability into brands. tive, based in Sweden’s second-largest city Gothenburg. An “Sweden in general has been at the forefront of the social side abbreviation for Don’t Eat Macaroni, the name is an anti-globali- of sustainability, though as a whole Swedish fashion has not sation statement. DEM’s founders Karin Stenmar and Annika understood its environmental impacts,” says SFA’s founder, Axelsson started by establishing their own factory in Colombo, Michael Schragger. Like the famously shy Ikea, Swedish fashion Sri Lanka, and paying their workers three times the going rate, brand managers see sustainability positioning as leaving their based on their research into a local liveable wage. They aim for brands open to criticism, Schragger says. Often, they do far more classic pieces – jeans, jackets and t-shirts. With whittled-down margins, they have enough consumer acceptance to now test the H&M high-fashion, 100% organic clothing in the US. Klättermusen, a young Swedish brand of athletic gear, is combining the Swedish appeal of the great outdoors with commitment to the environment. Their recovery and recycling initiative, Recover, gives consumers up to €20 for returning used gear to their stores. Better returns Boomerang, too, has followed suit with its “Boomerang effect”, a consignment return store. Klättermusen is unique among domestic apparel counterparts in assigning an eco-index to each of its products – a number on the label that includes its expected lifetime, sustainability of materials and prospective recyclability. Unfortunately fashion – with its ephemeral, get-what’s-hot psychology and consumption patterns – conflicts deeply with sustainability goals. Mega-fashion brand H&M knows this. It launched a well-received organic and recycled-material Garden Collection in 2010, and is pushing organic cotton into its basics. But it remains the pinnacle of fast fashion, and new, trendy, throwaway looks. So its missteps – accusations of misidentifying organic cotton items and cutting up unsold merchandise – garner more headlines than its positive moves. Here is sustainable fashion’s oxymoron. Mathilda Tham, professor of sustainability and fashion at Beckman’s School of Design, predicts a future dual-tack approach combining “fast” fashion with “slow” ideals. Here, truly throwaway fashions – instantly biodegradable dresses, or systems of use, not buy, are the future. To answer the need for novelty, Tham says fashion H&Ms basic ranges are going organic houses must look at what they are really selling – not a means to stay warm, she says, but a way to constantly recreate an identity. than they publicise. In an industry made up mainly of small and Tham’s new conception – “meta design” she calls it – sees the medium-sized firms, moreover, there are gaps in systematising psychological elements of fashion merging with open or even sustainability and strategic thinking. crowd-sourced design, and fashion “experiences” taking the This is epitomised by small fashion house Gudrun Sjöden. place of constant shopping. The eponymous founder says her company’s efforts to source Now there’s a trend worth following. n organic textiles and investigate Tencel/Lyocell cellulose fibre fabric to produce beautiful classics are among the country’s best April Streeter is a writer specialising in sustainability since 1998. Formerly based sustainable fashion examples. Sjöden claims 50% of the in Sweden, where she covered Scandinavia for Windpower Monthly, she now lives company’s items are “sustainably produced”. But she doesn’t in Portland, Oregon and is a blogger for Tree Hugger and The Huffington Post.
  5. 5. ERICSSON Ethical Corporation Country briefing: Sweden 57 Case study – Ericsson: turning iPhone into wePhone Usually touted as the latest “must-have” luxury consumer accessory, the mobile phone and the technology behind it also tells another story. Take Ericsson, the world-leading provider of telecommunications equip- ment and related services to mobile and fixed network operators globally. More than 1,000 networks in more than 175 countries utilise the company’s network equipment and some 40% of all mobile calls are made through its systems. Founded in 1876 and headquartered in Stockholm, Ericsson has more than 88,000 employees and, in 2008, generated revenue of 209bn kronor (€22.3bn). The company’s vision is “to be the prime driver in an all-communicating world” through innovation, technology and sustainable business solutions. So far so business-as-usual. But where Ericsson is turning the industry on its head is how it is putting its vision of “communication for all” into practice through the Millennium Villages Project. Starting from the premise that mobile technology is a key infrastructure that can deliver a number of services reliably and cost effectively in remote areas, in 2007 Ericsson became involved in the Millennium Villages Project, a bold, inno- vative model for helping rural African communities lift themselves out of extreme poverty. Launched by Jeffrey Sachs of the Earth Institute, Columbia University, the project uses communication technology to close the digital divide and raise the standard of living by providing access to real-time market information, health services and educational resources. Ericsson’s engagement in the Millennium Villages Project is a concrete example of the company turning its communication-for-all vision into a market Ericsson is closing the digital divide in Africa reality. With mobile subscriptions already topping the five billion mark, the company sees great potential for alleviating poverty and improving efficiencies energy and Solvatten‘s solar safe water system. at the base of the economic pyramid. HiNation’s concept – judged best business idea Elaine Weidman-Grunewald, vice-president for corporate responsibility and by the Stockholm Chamber of Commerce in sustainability, says: “If you take Africa which has 1-2% internet penetration but October 2010 – is a fittingly iconic product to come mobile penetration of about 40%, it’s clear the mobile phone will be the point of out of the land of the midnight sun, although its access for crop reports, or weather conditions, or where to sell your fish in the application is truly global. HiLight is a ROHS- market. As a result, economic conditions are dramatically improving.” compliant solar-powered combined lamp and It’s not without its challenges, however, Weidman-Grunewald says. “The charger that can produce 20 hours of light or three first challenge is to create a commercial business case otherwise it won’t scale mobile phone charges from 10 hours of sunlight. up or live up to the promise.” With 25% of the world’s population lacking Governments, too, need to play their part by creating an enabling environ- access to electricity, yet over 500 million mobile ment with the right legislation to support take-up. And they need to think phone users in Africa alone, HiNation plans to give cross-sectorally. “Industries have typically developed vertically, but by applying customers in emerging markets across Africa, Asia technology across sectors such as utilities, healthcare, energy and transport, you and Central America a safe, accessible and environ- get many more benefits.” mentally friendly alternative by which to study, Public-private partnerships, then, are essential. But what is remarkable work and remain connected. Enter cleantech with a about Ericsson’s efforts is how tackling poverty and creating more sustainable social face. societies is connected to the core business – the company is showing that it really is possible to address the lowest spending segments profitably and Safe water achieve sustainability goals with the use of broadband at the same time. The social value dimension of emerging Swedish cleantech is also evident in Solvatten, a container that cleans contaminated water in a couple of hours function for corporate social responsibility within using heat, UV and a built-in filter. The rationale for government. Catharina Kipp is currently CSR Solvatten is compelling: by removing the need for ambassador at the ministry of foreign affairs inter- women and young girls in developing countries to national trade policy department, where she heads spend several hours collecting firewood to make the Swedish Partnership for Global Responsibility. water safe, the product makes more time available Created in 2002 after the World Summit on Sustain- for productive pursuits, helping raise living stan- able Development in Johannesburg, South Africa, dards and make local communities more this group aims to spur Swedish companies’ work sustainable. It tackles head-on at least five of the on labour conditions, human rights, anti-corruption Millennium Development Goals. and environment. Sweden was the first country with a coordinated Kipp says: “It’s no longer a question of whether
  6. 6. 58 Country briefing: Sweden Ethical Corporation Sweden played to work with corporate responsibility, but how to do market conditions outside their Swedish comfort it. It’s a matter of minimising the negative impact zone. Growth in the uptake of the UN Global a leading role in that a company can have on the environment and Compact is one indicator of the trend for Swedish the development people. Many Swedish companies are at the fore- companies to develop universal or group-wide of ISO 26000 front in this regard.” approaches and standards. In late 2010, Sweden had 109 UN Global Compact The country recently played a leading role in the signatories – 25 of these since 2005. In general, the development of the ISO 26000 guidance on social concept of corporate responsibility is well estab- responsibility standards. Together with ABNT, the lished in mainstream Swedish business. A 2007 Brazilian Association of Technical Standards, the survey of 100 large corporations by Swedish Swedish Standards Institute (SIS) provided joint business magazine Veckans Affärer found that 88% leadership of the ISO working group on social of companies had increased their work with CR responsibility. issues, in particular in the areas of climate and envi- Published in November 2010, the voluntary ronment (81%) and being a good employer (78%). guidance applies to all types of organisations. The Swedish appetite for systemic approaches to Although it cannot be third party certified and is not CR has led to significant uptake of management a management system standard, it seeks to promote system standards such as ISO 14001. Calculating common terminology and bring consistency to environmental impact and tracking performance operationalising social responsibility, identifying are Swedish strengths. Companies in strongly risk- and engaging with stakeholders, and enhancing the based sectors have demonstrated particularly good credibility of reports and social responsibility claims. performance here, including airliner SAS, and forestry and manufacturing companies such as Restructuring by consensus Scania, Volvo, Electrolux, Atlas Copco, SKF and Dealing with the socio-economic impacts of restruc- Sandvik. turing has largely been a success story for Swedish But as companies increasingly shift production companies. Thanks to good relations with unions, a outside Sweden, they are confronting labour and practical, transparent and inclusive approach prevails. As a result, few moves have resulted in the kind of worker dissent experienced in Germany or TOMASZ_BERMANN/DREAMSTIME.COM France, and the more proactive companies have developed systems to ensure local communities continue to thrive, in spite of losing a major employer. In Västervik, for example, Electrolux individually tailored employment opportunities for staff when the vacuum cleaner factory closed down. A two- year project was launched to help the 511 employees find work. Electrolux donated its factory facility and invested 20m kronor (€2.1m) into growing the regional economy and in Forward Västervik!, a development company jointly owned by government and business. The outcome was that a 2009 Confederation of Swedish Enterprise regional ranking of economic viability rated Västervik 92nd out of 290 communities in Sweden – compared to 242nd place in 2004. A collaborative approach is common in Swedish responsible business initiatives. Volvo and Tetra Pak have joined WWF Climate Savers on carbon reduc- tion; Ikea and H&M have worked with Unicef on supply chain issues; and Ericsson has partnered with the Red Cross on disaster relief through Ericsson Response. Partnership at regional level has recently seen Nordic environment ministers agree to integrate climate aspects as a criterion for using the Nordic Ecolabel – the Swan. The ministers have also agreed to develop joint action to protect people and the environment against endocrine disrupters and chemical cocktail effects, and to jointly strengthen Working with Unicef on supply chain issues dialogue on a green economy with developing
  7. 7. Ethical Corporation Country briefing: Sweden 59 Case study – SCA: a big surprise in the woods As Europe’s largest private forest owner, it’s by 2020, based on a 1995 baseline. understandable SCA was an early adopter of In 2010, the annual global Carbon Disclosure Forest Stewardship Council (FSC) certification. Project survey named SCA number one in Formed in 1929 as a forest industry holding Sweden – and third in the Nordic region – for company, SCA is a personal care, tissue, pack- greenhouse gas emissions reporting. “We’re very aging and solid wood products company. In 2009, proud of our work to reduce our carbon emis- net sales amounted to 111bn kronor (€11.8bn). Its sions,” Strandquist says. “With net annual growth largest markets in terms of sales are Germany, the of 1% in our forests, we’re able to sequester 2.6m UK, US, France, Italy and Sweden – but markets tonnes of CO2 – which is approximately equiva- such as Argentina are growing rapidly. lent to how much we generate in our operations, SCA has a longstanding commitment to respon- not including suppliers.” sible forestry practices. Kersti Strandquist, Reducing energy costs – especially in pulp and The Baltic, vice-president for corporate responsibility, paper mills – remains in Strandquist’s words “an Sweden’s aquatic explains: “Our sector perceives forests as a extreme challenge”. To tackle this, SCA is gener- lifeline, is one resource. It dates back to the 1904 Swedish Sylvi- ating its own electricity using windpower and culture Act stipulating that forest should be combined heat and power generation units in our of the world’s regenerated. About 100 years ago the Swedish mills. A new unit called SCA Energy has been most threatened forest industry exploited natural resources, but that created to take this aspect of the business forward. law helped us become aware that it was a resource But SCA’s sustainability engagement doesn’t environments that needed regenerating.” Since that time, the stop at forests. In developing countries, rising volume of standing forest in Sweden has doubled. incomes and awareness of the health benefits of SCA was a pioneer of forest certification. The better hygiene are expanding use of personal care company owns 2.6m hectares of forestland, of products. Intimate care, however, is often a taboo which 2m hectares are used for timber produc- subject. As one of the world’s largest players in tion. In January 1999, SCA’s Swedish forests were personal care and the global market leader in certified under the FSC scheme. It is now one of incontinence care products through its Tena the world’s largest suppliers of FSC-certified brand, SCA is trying to change such perceptions. products, ranging from solid wood and pulp, to Through social marketing campaigns like its toilet paper, kitchen rolls and newsprint. award-winning Libresse Voice Battle in Scandinavia, SCA has also been reducing carbon emissions which engaged young women in expressing views since the early 1990s. In 2003, SCA launched E- on menstruation, and its Libresse School Program in save, a programme consisting of some 1,300 small Russia, which raises awareness around puberty and projects, which together reduce emissions by personal hygiene, the company is increasing 240,000 tonnes of carbon a year, saving €63m. consumer access to information and helping to Engagement of people on the local level has been destigmatise conditions such as male incontinence. key; in some parts of the business, bonuses are For SCA, it’s an economic and social win-win: raised linked to energy savings. The company has set an awareness means bigger business opportunities – absolute target to reduce carbon emissions by 20% and less unnecessary human suffering.countries, in preparation for the World Summit on PIOTR_WAWRZYNIUK/DREAMSTIME.COMSustainable Development in Rio de Janeiro in 2012. On the European front, having banned the useof mercury domestically, Sweden has pushed for EUleadership on the global mercury convention nego-tiations. Partnership will certainly be needed where theBaltic Ecoregion is concerned. One of the world’smost trafficked bodies of water and Sweden’saquatic lifeline, it is also one of the world’s mostthreatened environments. Overfishing, oil spillsand land-based, nutrient-rich pollution from agri-culture and industry continue to negatively impactthis fragile zone. Industrial interest in the Baltic is growing too –Russian/European consortium Nord Stream haslobbied intensively for permission to lay a pipelinealong the Swedish coastline. It gained consent in 100 years of careful management in Swedens forests
  8. 8. 60 Country briefing: Sweden Ethical Corporation KNURRHAHN/DREAMSTIME.COM Among companies listed on the Swedish stock exchange, only 21% of board members are women Fishing stocks frozen 2009, but debate remains on how the area could be another story, as highlighted by former leader of affected. With shipping expected to double in the Sweden’s political opposition Mona Sahlin when next 20 years, tourism growing exponentially, and she commented that the country has some of the the fishing industry struggling to rejuvenate criti- highest qualified taxi drivers around. cally low stocks, expect sparks as sectoral and Sweden is highly homogenous, yet immigrant national interests collide. populations have increased exponentially in the Signs of progress include ferry and cruise past 20 years. Today, 13% of the population is of shipping companies Viking Lines and Silja Lines non-Nordic origin, primarily consisting of Iraqis, signing a WWF moratorium in 2007 to stop offshore Yugoslavs and Poles, yet this is not reflected in waste dumping and bank SEB’s Baltic Sea fund, corporate hierarchies. which funds Baltic projects through WWF. Manpower, Sweden’s 10th largest employer in 2009, has identified diversity as one of its global The Achilles heel focus areas. It launched a well-received and uncon- If Swedish companies have a corporate responsi- ventionally direct advertising campaign bility weakness, it might be in the area of questioning the Swedish business sector’s ability to philanthropy – a possible contributor to only four recognise talent among the over-35s, women and Swedish companies making it into the DJSI World immigrants – marking a rare effort by a company to index in 2010 – down from six in 2005. address an issue that most Swedish businesses Diversity, too, in both ethnicity and gender, is a prefer to keep behind closed doors. Ericsson, for its recognised challenge in senior managerial and part, has tried to tackle the issue by encouraging board positions. Currently, among companies listed non-Swedes into senior management positions. on the Swedish stock exchange, 21% of board Overall, though, the Swedish approach to CSR members are women. Among state-owned compa- could be summed up by that uniquely Swedish Andrea Spencer-Cooke has been nies, it is 49%. In a market-friendly move to increase word “lagom” – which has no real equivalent in involved in sustainable business gender diversity, the Swedish prime minister, English, but means something like “just the right thinking and practice since the Fredrik Reinfeldt, recently suggested providing tax amount”. That’s not to say that Sweden has reached early 1990s. She is the former incentives to those companies willing to break that the end of the responsible business road – there are editor of Stockholm- trend. still many issues to be tackled – but that it is based magazine Tomorrow: Integration of ethnic and cultural diversity is proceeding in the right direction. n Global Sustainable Business.
  9. 9. Ethical Corporation Country briefing: Sweden 61 GAWAIN1960/DREAMSTIME.COMCivil societyA gentler NGO approachBy April StreeterSweden’s campaigning organisations have notched up notable successes through cooperationrather than confrontation o outsiders, Sweden presents a vision of clean senior adviser and communications manager for theT waters, boundless tree-filled wilderness andhealthy, hearty, nature-loving blondes. That’s a organisation. “People here started to understand that they had NGOs are aided by a governmentgeneralisation, but the picture resonates with to do something about sustainable development. structure thatSwedes themselves, which may be one of the TNS helped answer the ‘why’ question,” Törökreasons the country started early with environ- explains. “The first wave was why, now it’s about fosters high levelsmental regulation and domestic support for how.” of transparencynon-governmental organisations. Sustainability- How NGOs actually make the business case to and accesspromoting organisation The Natural Step (TNS) industries and implement positive change is, oforiginated in Sweden, and the country hosts one of course, trickier than just explaining why change isthe world’s largest WWF divisions. needed. WWF’s Evaeus believes Sweden is in Although it can lay claim to one of the earliest danger of losing its position as a frontrunner inand most famous cases of European tree activism – sustainability because it hasn’t moved swiftlythe 1971 “Almstriden” or “battle for the elms” – enough to scale the innovative products and solu-Swedish environmentalism generally favours a tions generated by NGOs and buddingmore collaborative approach. And while move- entrepreneurs. “[Swedes] have been resting a bit onments like the Nordic Action Climate Camp still their laurels especially in reference to climate policyfavour direct action, for the most part, public- and clean technology where they were once globalprivate partnerships are a Swedish speciality. leaders,” says Evaeus. “They need to step up their NGOs are aided in this by a government struc- efforts in this area in order to regain their lead.”ture that fosters high levels of transparency and Though she points out Sweden’s shortfalls,access. “Politicians are much more accessible in Evaeus is also intimately involved with its potentialSweden than in many other countries,” says Barbara successes – as co-developer of WWF’s three-year-Evaeus, manager of climate communications for old Climate Solvers project, which originated inWWF Sweden. Sweden and spotlights 24 of the country’s most innovative pre-market climate solutions. ClimateStep by step Solvers, Evaeus explains, doesn’t only promoteTNS, a catalyst of the corporate sustainability these game-changers, but uses them to galvanisemovement, sees the evolution of sustainability- support from government and policymakers forfocused non-governmental organisations in home-grown entrepreneurial green tech.Sweden as divided roughly into two phases. The So what do a hamburger and a bag of popcornfirst – from the late 1980s to the late 1990s – was a have to do with all this? The hamburger, as most inmobilising time, and NGOs such as TNS experi- the western eating world know, is a pretty goodenced rapid growth, according to Kaj Török, a poster child for sustainability’s challenges. A fast-
  10. 10. 62 Country briefing: Sweden Ethical Corporation PCRUCIATTI/DREAMSTIME.COM food burger from a chain such as McDonald’s or 2006, been heavily involved in Burger King has become an icon for food globalisa- sustainable development work in tion, obesity, inequality in working conditions and Afghanistan, for example. the environmental hoofprint of beef production. Although NGO Monitor is critical But fast-growing Swedish burger chain Max of the political agendas that deter- Hamburgers saw this poor reputation as a business mine how Sida’s money is spent, opportunity. In 2007, working closely with TNS the Sida has been instrumental in company re-examined its operations and dared to launching much-needed devel- ask the unthinkable: “Is a sustainable burger chain opment programmes in the even possible?” region, with special emphasis on Pär Larshans, Max’s director of sustainability, women. says the company used TNS’s four basic sustain- Sida has also granted 12m ability precepts to visualise the gap between current kronor (€1.3m) to the Swedish operations and sustainable ones. With the road NGO Hand in Hand. Founded in mapped, the company switched all its restaurants to 2000 with the support of former wind energy, bought low-carbon vehicles, and offset ABB chief executive Percy carbon throughout the supply chain via reforesta- Barnevik, Hand in Hand works to tion projects in Africa. It also cut GMOs from its empower women to start sustain- supply chain, upped its recycling rate, found FSC- able micro-financed companies, Half a million new micro-financed businesses in India certified paper for wrappers, and began a and recently established a bank. programme to hire and train disabled workers – 100 Micro-finance, especially in India, has recently and counting. It also put a CO2-equivalent tag on its come under close public scrutiny. Yet Hand in burgers and sandwiches – a revolutionary move in Hand’s work has made a tremendous difference in the food business. the Indian Tamil Nadu region in the last decade. In Sweden, NGOs More than 600,000 women have gone through its Popular with customers entrepreneurial training, and more than half a have been most TNS’s focus on dematerialisation convinced the million have started small businesses. successful where company that instead of sourcing post-consumer Tamil Nadu housewives Arulmani and Selvarani business and paperboard for kids’ meals, it should scrap the box are two such entrepreneurs. With a loan of 5,000 altogether. Max’s “fast, smart, and concrete” rupees (about €80), they set up a popcorn business consumer concerns delivery of results astounded TNS, Török says. in Selvarani’s kitchen. Six years on, they are making intersect But the biggest surprise of all was the popularity 10,000 rupees a month, have developed six different of the company’s actions. “There was a 27% increase snacks, and plan to brand their goodies. They can in customer loyalty [between 2007 and 2009] and the afford to send their children to school and their chief executive concludes that at least half of that husbands have joined the business. With the new comes from sustainability efforts,” Török enthuses. Sida grant and Barnevik’s business acumen, Hand April Streeter is a writer As Max’s chief executive Richard Bengfors puts it in in Hand now has the chance to attempt to work specialising in sustainability a report on the TNS-Max partnership: “Our sustain- similar magic in Afghanistan. since 1998. Formerly based in ability-related activities turned out to be our most How Swedish NGOs broach future sustainability Sweden, where she covered profitable initiatives ever.” challenges may well be framed by the work of the Scandinavia for Windpower In Sweden, non-governmental organisations Stockholm Resilience Centre. Gathering together 29 Monthly, she now lives in have been most successful where business and international scientists to create a new paradigm for Portland, Oregon, and is a consumer concerns intersect. For example, Rätte- sustainable development, the centre has established blogger for Tree Hugger and vistmärkt (the local Fairtrade NGO) has made big what it calls “planetary boundaries” for earth’s The Huffington Post. strides, getting Swedish consumers to increase their different systems – safe thresholds beyond which purchasing of Fairtrade certified foods by 75% in the risk for chaos grows uncomfortably high. The writers of this briefing are 2009 alone. The nine resulting boundaries – which include part of One Stone, a global team Human rights and social justice issues resonate climate change, land and freshwater use, chemical offering sustainability consultancy with the Swedish public. So it’s not surprising that and aerosol loading, biological diversity, ocean acid- and communications expertise Respect, established in 2000 by Swedish environ- ification, ozone depletion and the nitrogen and with specialised Nordic market mental pioneers Per-Uno Alm and Kaj Embrén, has phosphorus cycles – form the key issues NGOs insight. In addition to Stockholm, been able to create widely accepted business around the world will need to work on in years to One Stone’s partners and associ- sustainability tools by through two separate come. The centre will provide necessary data and ates are based in Edinburgh, networks, The Business Leaders Initiative on knowledge. “We’ve experienced increasing interest Sydney, Malta and Portland, Climate Change and Business Leaders Initiative on from NGOs in Sweden,” says Carl Folke, research Oregon. One Stone has more than Human Rights. director at the centre. “We hope their interest will two decades’ experience working Swedish faith in government-led domestic persist and contribute to sustainable development with multinational companies welfare also extends to its activities abroad. The of social-ecological systems, with a shift in perspec- to guide sustainability leadership government-sponsored Swedish International tive from saving the environment to being stewards strategies and provide focused Development Cooperation Agency (Sida) has, since of our own future.” n sustainability communication.
  11. 11. Ethical Corporation Country briefing: Sweden 63GovernmentLeading byexampleBy Astrid von Schmeling in StockholmNo one can accuse the Swedishgovernment of lacking ambition he Swedish government’s so-calledT “generation goal” aims to reduce pres-sures on the environment by 2020 (2050 forclimate change) to sustainable levels, basedon 16 national environmental quality objec-tives. Underpinning this are ambitiousgovernment targets, forward-thinking legis- Reinfeldt aims for full sustainability by 2050lation and big vision. Add to this aconforming populace and a close, if at times labour and environmental regulation. More undergone a steep learning curve on how totesty, partnership between government and recently, and particularly since the Conser- better manage its 57 (42 wholly owned) busi-business and these characteristics have vatives took office in 2006, the state relies nesses. Like Vattenfall, many have highallowed Sweden to leapfrog to a lower- increasingly on instruments such as tax sustainability impacts – such as miningcarbon, more gender-balanced society. cuts, liberalisation of infrastructure and company LKAB, which is transplanting two So in December 2009, Swedish prime partnerships. entire northern cities to continue its opera-minister and then-EU president Fredrik tions. The national liquor store,Reinfeldt set off to Copenhagen’s COP15 In bed with business? Systembolaget, is challenged to find a balancesummit with optimism. Carbon emission The current pro-business government in sustainable consumption of alcohol.rates can be decoupled from economic regards building partnerships with compa- “Some companies were doing a lot andgrowth – his 20-year experiment proved it: nies as key to achieving sustainability goals. others not. Our focus has been on increasingbetween 1990 and 2008, the country Look no further than Stockholm’s Royal transparency. We thought reporting couldreduced its carbon emissions by 12% while Seaport and its smart-grids project. be a tool to drive the work,” says Jennyits economy grew 50%. “The Swedish government stated that the Didong, responsible for state-owned No other sector embodies the Swedish smart grid is a national priority,” says Tomas holdings at the ministry of enterprise.approach better than energy, where the Wall, smart-grids project manager and vice- Consequently, in 2007, the ministry passed agovernment uses its role as regulator, owner president for research and development at decree that all state companies must reportand partner to lower carbon emissions, raise energy provider Fortum. “The city has been according to the GRI and be third-partythe proportion of renewable fuels, and a key driver; they took the initiative and verified. “No-one says that companiescreate a more efficient electricity market. Key placed high environmental requirements on should skip annual reporting, or that it coststo this approach is creating the conditions all partners. They set the direction and too much money. We wanted to givefor long-term rules in the energy market. targets, which we help realise.” The Swedish sustainability information the same status asSweden has imposed the world’s highest Energy Authority is funding 40% of the 30m financial information,” Didong says. Bycarbon tax on fossil fuels for industry, house- kronor (€3.2m) pre-study, which will shift to 2009, almost all companies reported andholds and transport. Although the cement, implementation as early as 2014. “There is 83% were verified, compared with 10%steel, aluminium, pulp and paper industries no other place in the world which can fulfil among the 100 top Swedish companies.still enjoy exemptions, to ensure continued such far-reaching goals,” Wall says. Internationally, the initiative hasinternational competitiveness. If there is a thorn in the side of the govern- received kudos for raising the bar on Through the Renewable Energy Direc- ment’s low-carbon vision, it is state-owned sustainability reporting among publiclytive, Sweden has attained 43% renewable Vattenfall, one of Europe’s largest generators owned companies. The Netherlands hasenergy, which is especially high in heating. of electricity and heat. The company has been followed suit and Spain has been at leastBig petrol stations are required to supply at highly criticised in its major markets in partly inspired by the approach.least one kind of renewable fuel, which has Germany and Sweden in 2009 for a lack of It is this no-nonsense pragmatism andspurred the growth of ethanol and biofuels transparency, mismanagement of its nuclear the acceptance of a little short-term pain forto 5.1% of total fuel consumption. The holdings and stubborn reliance on coal. In long-term gain that singles out Sweden’sgovernment’s goal is to raise this to 10% by 2009, 51% of electricity was generated politicians as leaders in the sustainability2020. The state also provides tax relief for through fossil fuels, while 49% of heating was space. nspecific industries to reduce their energy use. based on hard coal. Despite this, Vattenfall With the highest tax burdens and was supposed to spearhead the development Astrid von Schmeling, based in Stockholm, specialisesperhaps the most expansive welfare of a sustainable energy system but is falling in sustainability strategy and communications. She is aprogrammes in the world, doing business in well short of its mandate. former managing director of the magazine Tomorrow:Sweden demands an acceptance of complex As a result, the Swedish government has Global Sustainable Business.