Section 3: Corporate Climate Leaders

Key Takeaways

• Efforts to engage conservatives on climate change policy reform typically assume a leading role for business and corporate leaders. A cross-partisan model of environmental-business engagement held sway for decades on other issues. However, companies have been less willing to provide leadership on climate policy.
• Changing consumer attitudes are a major driving force behind corporate action on climate change—and will continue to be in the future. This trend is additionally supported by the historical, and increasingly large, role corporations see themselves playing in making an impact in the communities in which their employees live and work.

The environmental community has spent years engaging powerful business leaders as a means to broaden the dialogue about climate change and develop new and innovative ways to solve our country’s—and our world’s—challenges when it comes to reducing greenhouse gases, eliminating waste, and developing green energy. The World Resources Institute (WRI), for example, established its Corporate Consultative Group,¹ which boasts members including General Motors, Best Buy, Walmart, PepsiCo, and the Walt Disney Company. The Environmental Defense Fund (EDF) has its EDF+Business division,² which has partnerships with AT&T, McDonalds, KKR, and Starbucks. The World Wildlife Fund (WWF) has its Climate Savers,³ which include Johnson&Johnson, Sony, Volvo, and the Coca-Cola Company.

These partnership programs and leadership councils have certainly yielded positive impacts. Several case studies show how companies across a multitude of industries have reduced waste, cut water usage, slashed carbon emissions, and doubled down on their commitment to clean energy sources. For example, in 2016, WRI helped Mars, Incorporated develop a set of evidence-based targets for its billion-dollar “Sustainable in a Generation” plan,⁴ which outlined goals for the company’s carbon emissions, as well its as land and water use. Similarly, from 2012 to 2015, EDF worked with AT&T to identify ways to reduce water usage at the company’s cooling towers by 150 million gallons per year.

Market forces and changing consumer attitudes are almost certainly the driving force behind corporations’ increasing focus on green initiatives and environmental impact.⁵ A November 2016 paper in the International Journal of Communication titled “The Consumer as Climate Activist”⁶ found that nearly one-third of Americans said they “rewarded” companies they viewed as active on climate change, while roughly 20 percent said they had “punished” companies that opposed action on climate change. As the international conversation about climate change develops in the coming years, and consumers’ and shareholders’ appetite for environmentally responsible brands continues to grow, these initiatives are only slated to increase in number, frequency, and scale.

These initiatives mark important progress for a number of industries, and a more educated and climate-savvy corporate class is an integral part of making major progress as it relates to climate change. However, until now, no one has truly been able to rally the business community at large around state or federal policy reform as it relates to climate change and environmental protection, with the sole exception being the clean energy industry, which has an obvious business interest in doing so.

Engaging with environmental groups on these projects is an easy way to achieve specific business sustainability goals and cultivate goodwill among consumers. Moreover, from a business perspective, it’s a much more low-stakes strategy than lobbying Congress or the administration to pass major regulatory or political reform. This fact isn’t lost on pro-climate lawmakers—as U.S. Senator Sheldon Whitehouse (D- R.I.) said: “One of the dirty secrets that we have to live with is that even the good-guy corporations don’t show up in Congress to lobby for doing something about climate change. Collectively, they do zero or less than zero to support climate legislation… That leaves the field to the bad guys.”⁷

When any discussion arises about engaging conservatives on climate change policy reform, one of the first assertions is that businesses and corporate leaders will be an imperative part of the equation. Most would agree that business engagement and an eye toward market-based solutions is part of any sound conservative political strategy.

However, today’s political climate is unlike any we’ve seen in recent decades, and traditional political strategies won’t necessarily work under the current administration. Indeed, it will seem challenging to find corporations and CEOs who are willing to openly advocate for this issue when the president has made it clear that anyone who disagrees with him is at risk of becoming a target for public attack.

Many of the “good-guy” companies that are most vocal about climate change progress don’t necessarily “walk the walk” when it comes to supporting environmentally friendly policies. For example, in 2015, Amazon came under fire for its refusal to publicly release energy consumption figures at its data centers, as well as for a very late switch to alternative energy sources.⁸ This came shortly before the company joined a new White House initiative on climate change.⁹ Similarly, Nestle—which voiced its opposition to a Trump executive order rolling back parts of the Clean Power Plan—received criticism for its controversial water-sourcing practices and legal battles against those who oppose them.¹⁰

This has traditionally been viewed as a major challenge for advocates wishing to engage corporate voices in the fight for political progress on climate change: differentiating the earnest and committed from the multitude of voices vying for a “cheap and easy public-relations victory.”¹¹

It is telling that despite the widespread response from CEOs after the withdrawal from the Paris Climate Agreement,¹² there was relative silence from pro-climate businesses when the Administration rolled back the Clean Power Plan in October of 2017¹³—considered by many to be a much more harmful move toward reversing climate change policy successes.

Bill Shireman, author of Engaging Outraged Stakeholders, poses a counter-argument to the assumption that corporate actors are driven only by the desire to make more profit. From his perspective, there are many compelling reasons for corporations to proactively engage on issues like climate change. It improves brand reputation, drives employee engagement and retention, preempts government regulation, and positions the company as a leader among competitors. In addition, he argues that all corporations exist for a purpose—to solve a problem, to fill a need, or to improve life for consumers—and that the profit the company generates is the engine by which that purpose is fulfilled. Shireman leans on the words of the late David Packard, co-founder of Hewlett-Packard, to illustrate this point:

“Many assume, wrongly, that a company exists solely to make money…the real reason HP exists is to make a contribution…to improve the welfare of humanity…to advance the frontiers of science…Profit is not the proper end and aim of management—it is what makes all of the proper ends and aims possible.”¹⁴

Shireman sees his experience partnering with Coors to achieve statewide recycling, after repeated failures, as a model for common ground between the cause-driven left and the corporate sector. These are some considerations to bear in mind:

• Work must be done to build constructive, trusting relationships between businesses and advocates, and to foster honest conversations about everyone’s goals.
• The narrative that corporations and their leaders will do anything to maximize profit, regardless of the social costs, is unhelpful.
• Changing consumer attitudes are a major driving force behind corporate action on climate change—and will continue to be in the future.

Many more Americans (21 percent) said they had withheld business from companies they saw as opponents to climate progress than had contacted government officials about climate change (8 percent).¹⁵ And these behaviors have proven effective. Consumer activism is responsible for a number of major changes in the way major global companies do business. In February 2018, Unilever announced it would make public its entire palm oil supply chain after years of calls from consumer groups and environmental activists for greater transparency over concerns about deforestation and human rights violations.¹⁶ And Nike famously embarked on a multi-year effort to monitor and correct inhumane work conditions at its factories and in its supply chain after criticism and protests from labor activists and student groups.¹⁷

Corporations that want to be seen as leaders and innovators can choose to take this cue early on—to adopt policies that help reduce their carbon footprint and positively impact the environment on their own. And they will reap the benefits from climate-conscious consumers. But even those who lag on climate change will ultimately have to make changes due to the evolution of the market and consumer demand.

As consumer attitudes change, we can anticipate that these efforts will increase in their breadth and depth among leading corporations with the desire to have a positive social impact. For those more resistant to change, it can be expected that a global market, in the context of more climate-progressive policies in other countries, will eventually force them to either adapt or lose market share. Whether or not American federal policy keeps up with these changes will matter less and less as consumer demand fundamentally changes.