Titanic Strategy #1: Transparency and Accountability
The booklet “Saving the Titanic” was originally published by Paul Freundlich, founder of Green America (formerly Co-op America). It contains a dozen green strategies for our society to avoid the “icebergs” of climate change, nuclear catastrophe, economic collapse, and other ills. Today, we excerpt Solution #1, and over the next 12 days, we’ll share the rest of Paul’s solutions:
Honest reporting of the corporate footprint allows for internal improvement and external scrutiny. The Global Reporting Initiative (GRI) Guidelines reflect the effort of thousands of stakeholders world-wide, and offer a respectable standard for reporting on the total impact of the business sector, already followed by thousands of companies.
The so-called Triple Bottom Line (tracking financial, environmental and social performance) provides useful markers to assess the true success or failure of organizations. Costs are calculated based not only on short-term overhead or materials, but variables such as recycling and downstream expenses for clean-ups and healthcare. European companies, particularly, have been sympathetic, but until the financial markets demand these calculations, it will mostly be a matter of public relations. The Triple Bottom Line also tends to reduce the impact of quarterly income statements (since it factors in long-term considerations) and force a more balanced evaluation of performance.
How: Continuing pressure on the financial industry and corporate boards to take reporting seriously. Beyond separate environ-mental and social impact reports, the most recent iteration is integrated reporting which brings together all components of the triple bottom line—social, environmental and financial—in one, integrated sustainability report.
Result: Assessments can be more easily made of individual companies, and aggregated data provides the big picture of industries, regions and global business.
Probability: Impressive progress in reporting over the past decade, and the flow seems in this direction. Yet the emotional and economic investment in business as usual is massive. Expect edgy but growing theoretical respect, with practical changes coming in those companies whose business is most related to environmental outcomes.
In the days that follow, we’ll post the rest of Paul’s 12 strategies for righting the ship. What do you think about transparency and accountability?