Davos forum calls for balancing consumption and environmental impact

Eco-money The World Economic Forum leaned on private companies and governments to shoulder more environmental responsibility.

Deforested areas in Borneo are a visual reminder that the need for resource-efficient economies is high . AFP / Ho / Greenpeace
Powered by automated translation

The World Economic Forum (WEF) that took place last month in Davos, Switzerland, has triggered a global debate on the subject of corporate responsibility. But the WEF 2012 is already attracting flak from environmental groups such as Greenpeace.

Nevertheless, the forum has called for private companies and governments to shoulder more environmental responsibility. A report released by the WEF at Davos, entitled More with Less: Scaling Sustainable Consumption and Resource Efficiency, calls in particular for increased corporate responsibility towards the environment.

"There is an imperative for countries and companies to act to reduce the environmental consequences of consumption," the report says. "This report demonstrates that over US$2 trillion [Dh7.35tn] in global economic output in 2030 is at stake, so the need for rapid action to shift towards a resource-efficient economy is high."

Sarita Nayyar, the managing director of consumer industries for WEF USA, says: "In the four years since the World Economic Forum's Sustainable Consumption Initiative started, an estimated 450 million people have been lifted out of poverty.

"At a global level, this encouraging progress has come at the cost of higher resource consumption, continued environmental degradation and greater social and health imbalances.

"Over the same period, about 21 million hectares of forest were lost, 9.1 billion tonnes of municipal solid waste were generated and some 50 billion tonnes of fossil fuels were consumed. This pattern of economic growth and development does not have to continue."

The WEF report argues that businesses can improve their environmental sustainability by boosting communications with consumers. Businesses should not only embrace green strategies, but also address every stage of their operations in that light, it says.

"This will not be achieved by a small vanguard of leading companies or countries; decoupling needs to happen in every business and every country through a commitment to action," Ms Naayar says.

A long list of industry partners involved in the WEF's Sustainable Consumption Initiative includes retailers, such as Walmart and Marks & Spencer, manufacturers, such as Nike and Nestlé, and technology companies, such as DuPont De Nemours International.

The WEF says SC Johnson & Son, a global manufacturer of cleaning products, sources more than 40 per cent of its total electricity usage worldwide from renewable energy. An on-site wind turbine at the company's largest European facility can generate up to two thirds of its annual electricity. The company's factory in Medan, Indonesia, uses waste palm shells as a substitute for diesel fuel, cutting greenhouse gas emissions by more than 15 per cent and reducing diesel fuel use by 80 per cent. SC Johnson is also building wind turbines at its largest global manufacturing facility in Wisconsin, in the US, which will help to enable the on-site production of 100 per cent renewable electricity.

DuPont is another company the WEF says is creating products aimed at protecting the environment and achieving sustainability. DuPont has developed a new material, Zytel PLUS nylon, which replaces metal in applications with other nylons and eliminates 11 kilograms of weight per vehicle while doubling the life of parts exposed to high heat generated by car engines. The WEF says that if this product was integrated into the roughly 72 million cars manufactured last year, the need for 144 million gallons of petrol, the equivalent of three million barrels of crude oil, would have been eliminated.

Other corporate green initiatives quoted by the WEF include Unilever's Sustainable Living Plan, which sets a company-wide target to double sales while halving its environmental effect.

But the report also highlights consumer malaise when it comes to opting for green options rather than the alternatives. At a global level, Aegis Media's Consumer Connections Study surveyed 10,000 people in more than 40 countries, with half claiming they do everything they can to protect the environment. However, only 12 per cent were willing to take measures such as avoiding air travel.

Greenpeace says the WEF 2012 focused on the symptoms rather the cure and that, while the delegates acknowledged the scale of the world's environmental challenges, they failed to provide adequate solutions.

Suggestions from Greenpeace that corporations should be made liable for the effect they have on society and the environment were reportedly greeted with nervous laughter.

But the idea of obligatory corporate responsibility for the environment may not be as futuristic and Utopian as many of the Davos delegates assume. Already, carbon-emissions rulings are starting to affect airlines and make them pay closer attention to their environmental responsibilities.

Lobby groups say this kind of legislation could be more generally applied, making companies across sectors such as technology and autos start to implement far-reaching changes. At the moment, organisation like Greenpeace believe that many of today's green corporate initiatives are nothing more than window dressing.

Green investors can play an increasingly active role by following Greenpeace in demanding individual corporate responsibility from any company in which they invest. Those businesses that monitor their products' effect through every stage of the supply chain will, in any case, offer sustainable returns over the long term.