Ethics Trumps Sustainability

I posted a blog in January "sustainability is over-rated" in which I posited that sustainability was just one of the principles against which Corporate Responsibility can be judged and practiced. A number of people commented that we should focus on action and not worry too much about terminology. Call me obsessed, but I cannot let it go at that. I believe more and more that ethics underpins sustainability and that we must be able to speak to ethics to be able to resolve some of the most challenging sustainability issues we will face in the future.

The broadly accepted principle of sustainability asks that we use resources in a manner that satisfies current needs without compromising the needs or options of future generations. Who says that the needs of the yet to be conceived, their children and their children’s children ad infinitum, are valued equally highly with the needs of those alive today? The answer is that our predominantly accepted code of ethics tells us that.

If being sustainable turns out to be easy, this might not matter. However, if being sustainable turns out to require behavioral change and perhaps sacrifice, we will need to be able to articulate and defend the ethical foundation on which it is based. To illustrate, I like to look at another view of the world……..

At BSR last year, many others and I listened to an inspiring plenary highlight by Zhang Yue Chairman and CEO of BROAD air conditioning in China. We all felt so good listening to a fantastically successful Chinese businessman talk about all he achieved through his environmentally friendly business approach. But you could hear the sharp intake of Westerners’ breath when he stated that of course he fired any employee who had more than one child, because more than one child per family was not consistent with a sustainable population and planet. This contrast in values is fundamentally an ethics question.

I recently read Practical Ethics by Peter Singer. It provided me with a structure to step back from my inherited values and look at them from an external perspective. I have not changed my views (that much!), but I understand them and their heritage much better. I also learned that our approach to sustainability is rooted in ethics and that some of our most difficult dilemmas, in particular when two good outcomes compete in a zero sum game, need to be sorted with the help of ethics, before we can apply sustainability correctly.

Sustainability is Overrated

Well, perhaps I really mean overemphasized rather than overrated. As I said in my ‘Themes for 2010” post, I have some thoughts on terminology. I hear the term sustainability used as a catch all for corporate social responsibility. I hear it used as a catch all for addressing environmental issues. I don’t think either uses are correct.

The overarching theme is corporate responsibility. (Is it too late to change the title of my blog to CRPerspective?)

Then I see there being a set of principles that can be applied to help us in our corporate responsibility. Those principles are governance, accountability, ethics, transparency, materiality, and, of course, sustainability.

Many of the principles, but in particular sustainability, can be looked at within the context of three interdependent realms; social, economic and environmental.

So, for example, sustainability can apply just as readily to social and economic issues in the community as it can to environment. Consider the impact of sub-prime loans on the economic sustainability of the communities in which they were offered and the impact of tobacco on social sustainability (which includes health).

But the other principles are equally important. In using the term sustainability to describe the whole shebang of corporate responsibility we are underplaying the importance of those principles. We will not effect change without corresponding attention to governance, accountability, ethics, transparency and materiality.

And what of volunteering, community investment, stakeholder engagement, diversity, philanthropy, reporting, risk analysis, incentive programs, business cases and many other things that comprise the daily bread and butter of the job of CR practitioners ? I see these as tools. Tools that help the business deliver against the principles and across the three realms of CR.

I would be interested in your views on my approach.

Postscript - I added a new post on this topic titled "Ethics Trumps Sustainability" on May 26 2010

My CR Wish List For the Coming Decade

I know, the horse has bolted on some of these but it shouldn’t stop me from hoping, after all there are many things in place now in 2010 that we couldn’t have anticipated ten years ago. Here is a wish list for 2010 – 2020 that led me to envisage the press release in my previous post.

Daily stock prices become unavailable because no one has any interest in them anymore. Investors are in for the long haul and only really pay attention to the five year, ten year and longer term outlooks.

The ethical, social and environmental sustainability record of a corporate leader is as much a part of their professional credibility as the financial performance of the businesses they have led.

The CR role has become a profession that complements the accountants, lawyers, engineers and marketers that run our businesses such that corporations are not required to have a CR practitioner on the leadership team because they wouldn’t think of doing otherwise.

The predominant mode of discussion in the business world shifts from binary positions, legal style advocacy and resolution through the law and instead puts more emphasis on understanding alternative views, on holistic decision making and on arbitrated resolution of disagreement.

Green products, advertising and marketing disappear because it has become a basic requirement of doing business and it makes no more sense to advertise that your company is green than to advertise that it isn’t fraudulent or criminal or your product is not a safety hazard.

Individuals are able to reconcile the contrasting values they apply as members of civil society with those they apply as employees, as investors and as customers of a company, to reach a consistent and balanced view of how companies should act.