Day 6 -Private sector’s role in sustainable development

Written by Callum Alexander

There is a growing consideration that the private sector must be incorporated into driving environmental sustainability. International organisations like the United Nations (UN) are increasingly recognising the opportunity and necessity for the private sector to be encompassed into environmental strategy and decision making. In harmony with this, the United Nations Secretary General Ban KI-moon recently said:

“The United Nations and business need each other. We need your innovation, your initiative, your technological prowess. But business also needs the United Nations”

In accordance with the observation of the UN Secretary General a comprehensive framework  within the UN Global Compact initiative for business engagement was developed, within the detailed framework the UN specifically established how business leaders should enact to improve their influence within sustainability. Within the framework three of the principles established relate directly to environmental sustainability engagement:

  • Principle 7: businesses are asked to support a precautionary approach to environmental challenges;
  • Principle 8: undertake initiatives to promote greater environmental responsibility; and
  • Principle 9: encourage the development and diffusion of environmentally friendly technologies

Going beyond the framework, the UN has worked to integrate the private sector into its formulation of goals and targets. During the original creation of the now widely considered failed Millennium Development Goals (MDG) the private sector was minimally included and considered throughout the process. This went some way to exampling why the MDG’s were unsuccessful. Consequently, the UN has since recognised the failure to fully involve the private sector in the MDG, indicated by the development of the Sustainable Development Goals (SDG’S). The UN sought from the very beginning of negotiations to formally bring the private sector into the dialogue; to the delight of many commentators goal 17 ‘Global partnership for sustainable development’ really focused on the involvement of the private sector and established the multi-stakeholder approach to formulating strategy for sustainability. Within goal 17, target 17.17 “Encourage and promote effective public, public-private and civil society partnerships, building on the experience and resourcing strategies of partnerships” specifically details the relationship between the public and private sectors. Furthermore, target 17.16 outlines how we need to achieve sustainable development through a multi-stakeholder approach by enhancing the global partnership for sustainable development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources”.

When international organisations such as the UN work closely with the private sector they must carefully consider their position on neutrality, as to ensure that a situation is not being provided where the private sector can profit from the UN’s operations. Many commentators believe that for this reason and due to the lack of understanding of the UN’s protocols and operations, there is a lower level of private sector engagement than many would like to see.

The World Business Council for Sustainable Development (WBCSD) is an international organisation that brings together the public and private sector to support sustainable development. Working through its 190 international companies, the WBCSD provides a platform for companies to share experiences and best practices on sustainable development issues. It advocates their implementation, through working with and bringing together governments,  non-governments and intergovernmental organizations.

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On the sixth day of the Geneva summer school programme, we were given the opportunity to visit the WBCSD and find out first-hand how successful they have been with their model of linking together the private and public sector in the interest of sustainable development. However, from the information we were presented, there seemed very little evidence of concreate success but this might be limited by the presentation’s focus on up and coming projects.

From an external perspective of the WBCSD, commentators like Greenpeace have systematically accused the WBCSD of being the ‘Who’s Who’ for the world’s most carbon intensive organisations such as BP and Dow. This leads to many people suggesting the existence of greenwashing.

The private sector faces a variety of barriers when considering engaging in environmental sustainability, including but not exclusively the required return of investors and the lack of information within the private sector. Furthermore, there is a degree of public scepticism towards the private sector’s true intentions. Much evidence suggests organisations are systematically greenwashing; this is when a company spends more capital on publicising their environmental sustainability credentials rather than implementing them. Many of the organisations accused of this practice are the most carbon intensive organisations such as Royal Dutch Shell, who in 2008 were penalised by the UK Advertising Standards Authority for an advertisement that claimed that a $10bn oil exploration investment in Canada in some way contributed to a sustainable energy future. The existence of greenwashing unfortunately distracts from private sector organisations that are committed to sustainable development (https://www.youtube.com/watch?v=GYu7k1G9d1A).

Achieving true sustainable development will require action from all segments of society; this will therefore require close partnerships between the private sector, business and financial institutions. Although public organisations will remain wary of the private sector and in some regards rightly so, but they must not allow this to affect their judgement.

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